Land Regulation and Local Service Provision: Can Economic Growth and Environmental Protection Be Achieved Simultaneously?

Xiaodong Zhang, Kaifeng Duan (), Lun Yang () and Xiaokun Wei
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Xiaodong Zhang: School of Economics and Management, Tongji University, Shanghai 200092, China
Kaifeng Duan: School of Economics and Management, Fuzhou University, Fuzhou 350108, China
Lun Yang: School of Economics and Management, Tongji University, Shanghai 200092, China
Xiaokun Wei: School of Economics and Management, Tongji University, Shanghai 200092, China

Land, 2024, vol. 13, issue 9, 1-23

Abstract: This study examines the impact of China’s industrial land approval reform (ILAR) on the provision of subnational services. Utilizing the 2011 pilot reform policy approved by the State Council, we utilize a staggered Difference-in-Differences (DID) method to determine the reform’s impact on local economic growth and environmental protection. The findings reveal that the reform enhances local economic development and decreases pollution levels. Additionally, the reform significantly decreases land resource misallocation in pilot cities, enhancing productivity. We also find that local governments allocate more land to the tertiary sector through this reform, achieving industrial upgrading. The optimization effects are more pronounced in cities with higher fiscal pressure. Based on these findings, we recommend that policymakers sustain decentralization efforts and consider further incentives for cities under fiscal stress. We fill a gap in the literature by linking land use regulation with subnational service provision, contributing to the understanding of the socioeconomic benefits of decentralization and local government service levels.

Keywords: land approval management system; land misallocation; decentralization; economic growth; environmental protection (search for similar items in EconPapers)
JEL-codes: Q15 Q2 Q24 Q28 Q5 R14 R52 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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