Harnessing the Forces of Urban Expansion - The Public Economics of Farmland Development Allowance

ZEF-Discussion Papers on Development Policy No. 147

39 Pages Posted: 30 Jan 2011

See all articles by Nancy H. Chau

Nancy H. Chau

Cornell University - School of Applied Economics and Management; IZA Institute of Labor Economics

Weiwen Zhang

Zhejiang University - College of Public Administration; Columbia University - Columbia Earth Institute

Abstract

For decades, rapid urban expansion has led to concerns over the loss of cultivated land in rural China. This contrasts sharply with another salient feature of the Chinese land policy reform landscape that has gone on largely unnoticed - the addition of newly cultivated land in China through land development has consistently exceeded land conversion. In a model featuring fiscal decentralization, local governments as custodians of land use and development, along with a land development allowance policy instituted in 1998, we show that a land development allowance policy can harness the forces of urban expansion to encourage agricultural land development.

Keywords: land development allowance, fiscal decentralization, inter-jurisdictional competition, agricultural development

JEL Classification: H11, H77, P35, R5, R14, O18

Suggested Citation

Chau, Nancy H. and Zhang, Weiwen, Harnessing the Forces of Urban Expansion - The Public Economics of Farmland Development Allowance. ZEF-Discussion Papers on Development Policy No. 147. Available at SSRN: https://ssrn.com/abstract=1749866 or http://dx.doi.org/10.2139/ssrn.1749866

Nancy H. Chau (Contact Author)

Cornell University - School of Applied Economics and Management ( email )

Ithaca, NY 14853
United States
607-255-4463 (Phone)
607-255-9984 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Weiwen Zhang

Zhejiang University - College of Public Administration ( email )

268 Kaixuan Road
Hangzhou, 310029
China
86-571-8697-1987 (Phone)
86-571-8697-1987 (Fax)

Columbia University - Columbia Earth Institute ( email )

314 Low Library
535 West 116th Street, MC 4327
New York, NY 10027
United States

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