Construction land quotas as a tool for managing urban expansion

This paper examines the effectiveness of construction land quotas as a tool for managing urban expansion in China. Applying a difference-in-difference approach to panel data from 2006 to 2010 in 243 Chinese cities, it was found that construction land quotas were not always enforced. Although one-third of the Chinese cities exceeded their quota limits, quotas were effective in reducing annual urban expansion in all cities by an average of 70 ha. This effect was most pronounced in cities where quotas were binding. In the 72 cities with binding quotas, urban land expansion was reduced by an average of 269 ha annually after quota implementation. In total, quotas were attributed with the protection of 26,530 ha of land from urban expansion during the study period.