Hungry Childhood and Land Market Operations:Evidence from China

Tonglong Zhang, Hainan University

This paper examines how leaders' preferences affect their policy choices. Using data of plot-level transaction records and the regression discontinuity design approach, we investigate the impact of the preference of municipal party secretaries(MPS) shaped by their early-life experience, the unpredictable widespread famine occurred in exact 1959-1961, on their land market decisions in China. Our findings indicate that MPSs with early-life famine experiences significantly raise the prices of industrial and residential land. Additionally, we find that MPSs with early-life famine experiences pay greater attention to agricultural production, thereby expropriating less agricultural land. This results in a lower supply and consequently higher prices of residential land. Moreover, they are more inclined to supply industrial land through market rather than non-market, resulting in more market transactions and thus higher prices of industrial land. We suggest that variations in land market decisions among local governments can be attributed to local leaders' differing resource allocation preferences, influenced by their early-life experiences. This paper contributes to understanding the land market, leaders' policy preferences, and the interaction between the two in certain developing country contexts.

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 Presented in Session 204. Property Rights, Land Markets, and Cultural Industries