| Since 1990 s,China has experienced high-speed economic growth,together with a large promotion of the urbanization level.The urbanization in China,however,is not healthy.As two fundamental factors,the urbanization of land is much faster than that of population in China.When we further look into the problem in detail,the imbalance mainly appears in the middle and western part of china,while the growth rate of population in eastern of China is relatively matched with that of urban land.Since 2008,China has appeared large-scale new town construction.Both the number and the planned acreage of new towns soared dramatically.However,most of these new towns were built in middle and western provinces where the population was declining and the economic competitiveness was low.Accordingly,these large-scale and high-standard new towns can scarcely attract population and industries,resulting in poor performance and gloomy prospect with some even being described as “deserted town” and “ghost town” by media.Along with massive new town construction,China's local government debt has accumulated to a massive scale.By the end of June 2013,China's local government debt and contigent liabilities ballooned to 17.9 trillion yuan,including 10.9 trillion yuan directly born by local governments and 7 trillion contingent debt(local governments either provide guarantees or have potential bail-out responsibilities)according to the National Auditing office.Aside from large amount of debt,the government debt ratio varies from city to city,with debt ratio of middle and western cities much higher than that of eastern cities.It can be seen that the swollen debt burden of China's local government is highly related to the new town construction.Since new town construction is long-term infrastructure investment implemented by local government through borrowing.Due to poor economic performance,local government may lose the ability to repay debt with the fiscal revenue.Consequently,local governments have to refinance or rollover their maturing bank debt,therefore keeping their debt ratio high.Following the analysis above,we can ask whether it is new town construction that results to a high local government debt ratio in middle and western provinces,and what causes the efficiency of new town construction to differentiate among various regions of China.This dissertation will conduct an in-depth research to the series of questions mentioned above.This dissertation mainly focuses on the construction pattern of new towns in China based on a set of manually-collected new town data.By matching urban construction investment bonds(UCIBs)panel data issued by local government financing vehicles(LGFVs)with city-level new town construction panel data,in chapter 5,this dissertation elaborate the research from three aspects.Firstly,whether new town construction results in local government debt financing? Secondly,how does new town construction influence local government debt ratio? Thirdly,as we can see the debt ratio of local government varies among different regions,does new town construction pattern have the similar heterogeneity?Why do local governments in different regions adopt new town construction planning with different efficiencies? According to this dissertation,what construction planning local governments take is not random,but affected by local land property right protection tradition.By using a set of manually-collected city-level new town construction panel data,matched with city-level land property right protection tradition variable,given the share of owner cultivator in the twenties and thirties of last century as instrumental variable,in chapter 6,this dissertation elaborates the research from two aspects.Firstly,how does local land property right protection tradition influence the construction planning of new towns? Secondly,as an institutional factor,does land property right protection tradition affect new town construction planning differently in scenarios of either steady economic growth or economic slump.The research conclusion of this dissertation is as below:In the first part,the dissertation examines the impact of the land property right protection tradition on the new town construction pattern.It is found that cities with better land property right protection tradition have planned new town construction with smaller acreage,higher density and shorter distance from main district.To be more specific,during steady economic growth,local government will think about practical development needs of its own city and take efficiency into consideration when making new town construction planning.In this case,the effect of land property right protection tradition is not significant.Whereas,once the local government confronts slumping economy and takes steps to boost the economy in the short term,namely the period from 2009 to 2012,efficiency and sustainable development are no longer the purpose of local government.Under the circumstances where new town construction is used widely to offset the economic slowdown,good land property right protection tradition plays a vitally important role in guaranteeing the efficiency of new town construction.In the second part,this dissertation examines the impact of new town construction pattern on the debt ratio of local government.Based on the research,new town construction accounts partly for UCIBs issue and has caused a sharp rise of local government debt ratio especially after year 2009.Furthermore,higher density helps reduce local government debt ratio.Shorter distance from the main district reduces local government debt ratio gradually since the new town was built.The effects of new town construction mentioned above mainly lies in the regions with net outflow of population,small and medium-sized cities,central and western part of china.Instead,there is a different effect of new town construction on the regions where net inflow of population happens,i.e.large cities and eastern part of China.In these regions,higher density increases local government debt ratio in the initial stage of new town construction.However,as time goes by,higher density reduces that debt ratio,because of the population agglomeration effect.On the basis of conclusions above,the research contribution of this dissertation are as follows.Firstly,the dissertation sets up a relatively complete and accurate China's new town database with manual collection,which provides not only comprehensive understanding of current situation of new town construction in China but also data support for further research on China's new town construction.Secondly,this dissertation,for the first time,applies new economic geography theory to the study on China's new town construction and its effects on local government debt.The work in this dissertation reconfirms the vital importance of density and distance for efficient urban economic development.Meanwhile,the empirical evidence is a solid support for new economic geography theory,enriching its literature reference.Thirdly,starting from the expenditure of local government debt,namely new town construction,this dissertation proposes a new striving direction to solve local government debt risk while existing literature mainly raises solutions from the perspectives of fiscal and taxation system,administrative system,urban economic development,etc.Local government debt is indeed infrastructure investments resorting to borrowing finance.Low efficiency in new town construction and high debt ratio of local government are the two sides of the same coin.This dissertation illuminates the way for improving the efficiency of new town and solving local government debt risk at the same time.Fourthly,this dissertation finds out the local land property right protection tradition as a fundamental factor influencing the new town construction pattern.According to the conclusion of this dissertation,although new town construction planning seems to be a choice of local government,it is endogenously determined by the local land property right protection tradition and the completeness of the market rule.In order to promote the efficiency of new town construction,it is better to start with institution enhancement,aside from keeping eyes on density and distance.Building up modern economic order based on sound property right protection system can be an ultimate approach.Lastly,this thesis manifests the importance of institution on economic efficiency and long-term development,further enriching the literature on new institutional economics and providing guidance for cultivating modern economic institution in developing countries.Only when property right protection concept is embedded in people's value and behavior,can China achieve virtuous and sustainable economic development. |
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