Land Titling in China: Chengdu Experiment and Its Consequences

Abstract

Lack of transfer rights for collectively-owned land has led to inefficient land use and rising urban-rural income inequality in China, which calls for property rights reform in the rural area. This paper studies the land titling experiment in Chengdu since 2008. Based on field surveys and analysis of data on land transactions, we find that rural residents’ income and wealth increased significantly after achieving transfer rights on collectively-owned land. The implied land price is found to be correlated with the strength of property rights. With land titling, the market for rural construction land is growing in Chengdu. We argue that a property rights reform that changes the primary role of rural land from welfare to property will provide China with an opportunity to achieve urban-rural harmony and land use efficiency while maintaining its fast urbanization process.

Keywords: land titling, property rights delineation, land market, rural construction land, China

JEL Classification: Q15, R52, H71, K11