Can administrative division adjustment improve urban land use efficiency? Evidence from “Revoke County to Urban District” in China

Abstract

Government-led administrative division adjustment has occurred throughout the various stages of China’s social development and serves as a significant driving force for urbanization in the country. As representative of administrative division adjustment, the Revoke County to Urban District (RCUD) policy has played a crucial role in the urbanization process in China. The question must therefore be asked as to whether RCUD does indeed enhance urban land use efficiency (ULUE). This has significant implications for China’s new-type urbanization strategy and high-quality economic development. This paper constructs a research framework on the relationship between RCUD and ULUE, and empirically examines the effect of RCUD on ULUE using data from Chinese prefecture-level and above cities. The results show that RCUD significantly promotes improvements to ULUE, and this conclusion still holds after a series of robustness and endogeneity tests. The policy effect of RCUD exhibits heterogeneity, not only in terms of economic development but also in terms of city size and in terms of RCUD reform experience. The effect improvements to RCUD have on ULUE is more pronounced in economically developed cities. Furthermore, RCUD significantly increases ULUE only in large cities and above; the impact of RCUD is greater in cities with prior experience. Mechanism tests reveal that promoting elements agglomeration and optimizing industrial structure are important channels by which RCUD can enhance ULUE; however, the disorderly expansion of boundaries triggered by RCUD has adverse effects on ULUE. The research findings provide theoretical support and reference for optimizing further RCUD reform and enhancing ULUE.