Land use policy and employment growth- evidence from China

Qiao Wang, Xiuyan Liu, Sam Hak Kan Tang, Cong Du

Research output: Contribution to journalArticlepeer-review

3 Citations (Scopus)

Abstract

This paper examines the causal effect of land use policy on employment growth in Chinese cities. We find that a stricter Floor Area Ratio Regulation (FARR) leads to a reduction in employment growth in Chinese cities-a one percentage point reduction in FARR leads to a concurrent reduction of employment growth by 1.0–1.5 percentage points. More populated cities and labour-intensive manufacturing industries are found to be more severely affected by stricter FARR. Moreover, the effect of a stricter FARR is found to be less pronounced on state-owned firms compared to foreign-owned and privately-owned firms. Our main conclusions are robust to a variety of sensitivity tests, different instruments and alternative estimators. They suggest that imposing a stricter legal FARR incurs considerable employment costs for Chinese cities.

Original languageEnglish
Article number102546
JournalHabitat International
Volume123
DOIs
Publication statusPublished - May 2022

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