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GOVERNMENT INTERVENTION, LAND MARKET, AND URBAN DEVELOPMENT: EVIDENCE FROM CHINESE CITIES
Author(s) -
Zhang Jipeng,
Fan Jianyong,
Mo Jiawei
Publication year - 2017
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/ecin.12353
Subject(s) - economic interventionism , urbanization , government (linguistics) , china , economics , intervention (counseling) , productivity , wage , population , supply and demand , labour economics , economic growth , development economics , geography , macroeconomics , political science , psychology , linguistics , philosophy , demography , archaeology , psychiatry , sociology , politics , law
This article investigates how government intervention in land market affects China's urban development, using data from prefecture‐level cities between 2000 and 2010. We find that government intervention enlarges the impact of positive productivity shocks on housing price appreciation, through mainly the government control over residential land supply. However, we find no significant evidence that high government intervention constrains population growth and leads to wage increase. Such patterns of urban dynamics can be explained by the fact that migrant workers are the driving force behind China's urbanization, but they have limited housing demand and are not well compensated. ( JEL P52, R12, H11)