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Spatial analysis of competition among local governments and the price of land: the case of Zhejiang Province

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  • Kai Kajitani
  • Daisuke Fujii

Abstract

This empirical study focuses on competition between local governments as they strive to attract companies through the auction of land use rights. In the literature on competition between local governments, the focus has tended to be toward growth rates based on performance evaluation or tax rate-based competition for attracting companies. In China, the property tax system is still underdeveloped and local governments cannot independently set tax rates. Therefore, this study focuses on a type of ‘dumping’ activity by which local governments auction land use rights to attract industrial companies and empirically test this hypothesis using the spatial lag model.

Suggested Citation

  • Kai Kajitani & Daisuke Fujii, 2016. "Spatial analysis of competition among local governments and the price of land: the case of Zhejiang Province," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 14(3), pages 229-242, July.
    • Handle: RePEc:taf:jocebs:v:14:y:2016:i:3:p:229-242
    DOI: 10.1080/14765284.2016.1221268
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