Dose Land Negotiation Policy Promote or Suppress Hidden Debts of Local Governments?
Using panel data from 275 prefecture-level cities in China spanning from 2003 to 2019, this paper employs the multiperiod difference-in-differences method to empirically analyze the policy effect of land negotiation policy on local governments’ hidden debt. The paper also investigates the influence...
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MDPI AG
2023-04-01
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Series: | Land |
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Online Access: | https://www.mdpi.com/2073-445X/12/5/985 |
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author | Yinglan Zhao Jingwen Xu Chen Feng Chi Gong |
author_facet | Yinglan Zhao Jingwen Xu Chen Feng Chi Gong |
author_sort | Yinglan Zhao |
collection | DOAJ |
description | Using panel data from 275 prefecture-level cities in China spanning from 2003 to 2019, this paper employs the multiperiod difference-in-differences method to empirically analyze the policy effect of land negotiation policy on local governments’ hidden debt. The paper also investigates the influence mechanisms of land finance, budget soft constraints, fiscal decentralization and government competition. The empirical results reveal that: (1) Land negotiations promote the expansion of local governments’ hidden debt, which is counterproductive to the sustainable development of government finances. (2) The impact of land negotiation policy on local government’s hidden debt is transmitted via its effects on land finance. (3) The greater the degree of soft budget constraint and the degree of government competition, the less the expansion effect of land negotiations on the hidden debt of the government. The greater the degree of fiscal decentralization, the greater the expansion effect of land negotiations on the government’s hidden debt. (4) Land negotiation promotes the expansion of hidden debt in eastern China and inhibits it in central China, with no significant effect observed in western China. (5) Cities with larger urban scale and higher economic development levels experience stronger effects from land negotiation policies. Therefore, it is imperative to deepen the land negotiation system further, develop policy indicators and feedback mechanisms tailored to local conditions, and introduce a multiparty supervision system to enhance implementation of the land negotiation system. |
first_indexed | 2024-03-11T03:34:53Z |
format | Article |
id | doaj.art-da3142f6ae8c458c816d88dd13cdab36 |
institution | Directory Open Access Journal |
issn | 2073-445X |
language | English |
last_indexed | 2024-03-11T03:34:53Z |
publishDate | 2023-04-01 |
publisher | MDPI AG |
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series | Land |
spelling | doaj.art-da3142f6ae8c458c816d88dd13cdab362023-11-18T02:06:11ZengMDPI AGLand2073-445X2023-04-0112598510.3390/land12050985Dose Land Negotiation Policy Promote or Suppress Hidden Debts of Local Governments?Yinglan Zhao0Jingwen Xu1Chen Feng2Chi Gong3School of Economics, Sichuan University, Chengdu 610000, ChinaSchool of Economics, Sichuan University, Chengdu 610000, ChinaSchool of Economics, Sichuan University, Chengdu 610000, ChinaBusiness School, Northeast Normal University, Changchun 130000, ChinaUsing panel data from 275 prefecture-level cities in China spanning from 2003 to 2019, this paper employs the multiperiod difference-in-differences method to empirically analyze the policy effect of land negotiation policy on local governments’ hidden debt. The paper also investigates the influence mechanisms of land finance, budget soft constraints, fiscal decentralization and government competition. The empirical results reveal that: (1) Land negotiations promote the expansion of local governments’ hidden debt, which is counterproductive to the sustainable development of government finances. (2) The impact of land negotiation policy on local government’s hidden debt is transmitted via its effects on land finance. (3) The greater the degree of soft budget constraint and the degree of government competition, the less the expansion effect of land negotiations on the hidden debt of the government. The greater the degree of fiscal decentralization, the greater the expansion effect of land negotiations on the government’s hidden debt. (4) Land negotiation promotes the expansion of hidden debt in eastern China and inhibits it in central China, with no significant effect observed in western China. (5) Cities with larger urban scale and higher economic development levels experience stronger effects from land negotiation policies. Therefore, it is imperative to deepen the land negotiation system further, develop policy indicators and feedback mechanisms tailored to local conditions, and introduce a multiparty supervision system to enhance implementation of the land negotiation system.https://www.mdpi.com/2073-445X/12/5/985land negotiation policylocal government hidden debtmultiperiod difference-in-differences model |
spellingShingle | Yinglan Zhao Jingwen Xu Chen Feng Chi Gong Dose Land Negotiation Policy Promote or Suppress Hidden Debts of Local Governments? Land land negotiation policy local government hidden debt multiperiod difference-in-differences model |
title | Dose Land Negotiation Policy Promote or Suppress Hidden Debts of Local Governments? |
title_full | Dose Land Negotiation Policy Promote or Suppress Hidden Debts of Local Governments? |
title_fullStr | Dose Land Negotiation Policy Promote or Suppress Hidden Debts of Local Governments? |
title_full_unstemmed | Dose Land Negotiation Policy Promote or Suppress Hidden Debts of Local Governments? |
title_short | Dose Land Negotiation Policy Promote or Suppress Hidden Debts of Local Governments? |
title_sort | dose land negotiation policy promote or suppress hidden debts of local governments |
topic | land negotiation policy local government hidden debt multiperiod difference-in-differences model |
url | https://www.mdpi.com/2073-445X/12/5/985 |
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