Heterogeneous mechanisms of urban land price in China: a perspective of natural restrictions and strategic supply

Analyzing how the underlying mechanism influences land value changes is essential to understanding the land market, which contributes to sustainable urbanization. Drawing upon a land transaction dataset, we analyze the determinants of urban land prices from 2008 to 2020, considering land supply and demands, with particular attention to natural restrictions and government interventions in China. The statistical analysis suggests that the inequality in industrial and commercial land prices rose from 2008 to 2015 and decreased after 2015. The inequality in residential land prices has kept rising from 2008 to 2020 because land finance is still essential to local government. Discriminatory price strategy for industrial land prices in eastern China is getting more popular. The regression models reveal the significant negative impact of natural restrictions on land price, and such impact from natural restrictions is decreasing after 2015. The market forces represented by city-level socioeconomic factors are becoming more important after 2015, indicating a more free land market in China. We also find the gaps between cities and counties in land prices are closing, which might benefit the recent development in rural and county region of China. These findings provide important insights into the transition in the land market in China from 2008 to 2020, which also contribute to a better understanding of the spatial inequality in the land market and the heterogeneity in different land-use types.