Impact and mechanism of marketization of collectively-owned commercial construction land on supply of state-owned industrial land: A perspective of interaction between urban and rural industrial land markets

[Objective] The marketization of collectively-owned commercial construction land marks a major institutional breakthrough in China’s land use reform. This study aims to investigate how this policy affects the supply of state-owned industrial land, thereby providing policy references for optimizing the marketization system of collectively-owned commercial construction land and establishing a unified urban-rural construction land market. [Methods] Using the two batches of marketization pilots for collectively-owned commercial construction land launched in 2015 and 2016 (hereinafter referred to as the “marketization pilots”) as a quasi-natural experiment, a multi-period difference-in-differences (DID) model was constructed. County-level balanced panel data from 2012 to 2019 were employed to investigate the impact of the marketization pilots on the supply of state-owned industrial land and their underlying mechanisms. [Results] (1) The marketization pilots significantly increased the supply of state-owned industrial land, indicating that local governments still dominated the allocation of industrial land. (2) This promotional effect varied depending on the central government’s deployment batches and local governments’ response methods, showing greater prominence in the second batch of pilot regions, counties (or county-level cities) with relatively developed secondary industries, and less developed regions of central and western China. (3) Two key mechanisms through which the marketization pilots promoted the supply of state-owned industrial land were identified: facilitating the relocation of urban stock enterprises to rural areas to enable the resupply of existing state-owned industrial land, and increasing the allocation of new construction land quotas for local governments. [Conclusion] Under local government intervention, the marketization pilots have a stronger promoting effect than a crowding-out effect on the supply of state-owned industrial land. Accordingly, clear boundaries should be delineated to constrain local government intervention, and the systematic planning and coordination of different marketization channels for collectively-owned construction land should be strengthened, thereby promoting the development of the market for collectively-owned commercial construction land.