Industrial land dependence and industrial land-use efficiency: Land resources curse hypothesis and test

Abstract

Abstract Historically, local governments have relied on their monopoly position in the land market to consistently provide abundant industrial land at low prices, resulting in the adverse “resource curse” effect, whereby dependence on industrial land undermines high-quality industrial development. Avoiding the negative impact of industrial land dependence on land resources is an inherent requirement and the sole path towards establishing China's modern economic system based on high-quality industrial development. This study examines the impact, transmission mechanism, and heterogeneous effects of industrial land dependence on industrial land use efficiency using panel data from 286 cities at the prefecture level and above in China from 2003 to 2019. The findings indicate that: (1) industrial land dependence diminishes the efficiency of industrial land utilization. (2) Concerning the transmission mechanism, industrial land dependence exacerbates the misallocation of resources, hampers innovation, and leads to increased pollution emissions, thereby reducing industrial land utilization efficiency and compromising industrial development quality. (3) The study also examines the heterogeneity effect across varied regions, resource-rich cities, city sizes, and land supply reduction policies, demonstrating the pervasive nature of industrial land dependence at the national level. This study offers empirical evidence and policy implications from the perspective of the industrial land resource curse, aiming to facilitate the systematic withdrawal of current industrial land and foster high-quality industrial development. JEL: Q24; Q32