Title: Rural Land Reallocation Reform in China: A Behavioral Economics Perspective
The speaker: Dr-Helen X. H. Bao, Department of Land Economy, University of Cambridge
Host: Prof. Gong Pu
Time：PM3:00 on Jul. 2
Place: Room 121 in the School of Management

Abstract：The “induced versus imposed” institutional change debate has yet to reach a consensus in the studies of rural land reallocation reform in China. Contrary to the common treatment of the two types of institutional changes as competing theories, we unify them in one theoretical framework under prospect theory. This theoretical model is verified using survey data from 17 Chinese provinces between 2005 and 2010. Our theoretical framework and empirical verification explain the driving forces behind the success of the rural land reallocation reform in China. We find that rural land reallocation reform in China is characterized by induced and imposed institutional changes.The relationship between induced and imposed institutional change is complementary instead of competing. The decision and frequency of land reallocation are affected by both local endowment and central government policy. Empirical findings also suggest that land reallocation reform in China is incremental, with interim policy targets from different stages taking gradual effect. The incremental implementation of the “No Reallocation” policy is the reason behind the widespread, diversified land reallocation practices across the country; this policy also contributes to the success of rural land reform in China. The theoretical model can be used to study a wide range of government-led institutional changes in China, such as affordable housing schemes and the National New-type Urbanization Plan (2014-2020).