The Land System and the Rise and Fall of China’s Rural Industrialization: Based on the Perspective of Institutional Change of Rural Collective Construction Land

Dongshui Xie, Caiquan Bai, Huimin Wang and Qihang Xue
Additional contact information
Dongshui Xie: College of Economics and Trade, Hunan University of Technology and Business, Changsha 410205, China
Caiquan Bai: The Center for Economic Research, Shandong University, Jinan 250100, China
Huimin Wang: School of Economics, Shandong University, Jinan 250100, China
Qihang Xue: School of Economics, Shandong University, Jinan 250100, China

Land, 2022, vol. 11, issue 7, 1-22

Abstract: China’s rural industrialization, which flourished in the 1980s, has suddenly declined since the mid-1990s. Based on the perspective of institutional change of rural collective construction land, this paper discusses the reasons behind the rise and fall of China’s rural industrialization. Using the empirical tests of China’s provincial panel data from 1987 to 1997, it is found that from the 1980s to the mid-1990s, the government relaxed the regulation of collective construction land and allowed its transfer, which was the institutional basis for the rapid rise of China’s rural industrialization with township and village enterprises (TVEs) as the main form. Furthermore, this paper takes the government’s policy of prohibiting the circulation of collective construction land from the mid-1990s as the breakthrough point, and uses the “Land Administration Law of China” promulgated in 1998 as a quasi-natural experiment to examine the causal relationship between restricting the circulation of collective construction land and the decline of TVEs. It is found that the restrictions on the circulation of collective construction land caused by the implementation of the law significantly hindered the development of TVEs. After the implementation of the Land Administration Law, in areas affected more by the law, the development scale of their TVEs shrunk even more. The analysis of this paper shows that deepening the reform of the system of property rights on agricultural land and ensuring farmers’ rights of land circulation are important ways to revitalize the rural areas.

Keywords: rural industrialization; township and village enterprises; land system; collective construction land (search for similar items in EconPapers)
JEL-codes: Q15 Q2 Q24 Q28 Q5 R14 R52 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2073-445X/11/7/960/pdf (application/pdf)
https://www.mdpi.com/2073-445X/11/7/960/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jlands:v:11:y:2022:i:7:p:960-:d:845405

Access Statistics for this article

Land is currently edited by Ms. Carol Ma

More articles in Land from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().