Land finance of Chinese local governments: formation and distortionary effects on urbanization

• 来源期刊: 中国财政与经济研究（英文版）
• 关键词: Chinese local governments land finance urbanization distortionary effect
• 年，卷（期）: 2014,（3）
• 页码范围: 38-55
• 页数: 18页
• 语种: 英文

摘要

This paper explores the distortionary effects of the 1994 reform of the system of tax revenue sharing between the central and local Chinese governments and its interaction with the incentives for local officials to promote local economic growth.One of the major distortions was to encourage local governments to rely on land finance in their efforts to promote urbanization and growth.This paper analyzes the causes and effects of increasing dependence on land finance and provides constructive suggestions for solutions to the problems that over reliance on land finance have generated,including their distortionary impacts on the urbanization process.