After a number of signs over the years that China’s rural land tenure system would be reformed to match its urban land tenure system, China’s leadership has apparently had a change of heart.
On the Heritage Index of Economic Freedom, Hong Kong is often ranked as the most free economy on Earth. But all Hong Kong land is owned by the government.
In the U.S. we don’t see private ownership of land as a threat, but in Hong Kong the British did.
This complex topic is over my head. In my recent article “China is no Longer Communist” I deliberately dealt only with urban, industrial, work units and avoided rural collectives.
I would encourage everyone not to think that anything necessarily follows from the term "ownership". In other words, if all you are told is that X "owns" some land, you still don't know anything important about who controls and who benefits from the use of that land. A long-term leasehold is substantially the same thing as fee simple ownership; the only difference is that it isn't forever. But if we're talking about a 70-year leasehold, the value of the retained interest of the "owner" is trivial. Hong Kong's system arose because of its colonial status; at one point they had 999-year leaseholds. There is no significant difference between that and full ownership. In London today substantial amounts of real estate are actually held under very long-term leases that everyone talks about as ownership. I discuss all this in the article I linked to in the post: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2471449.
My pet peeve is people who will say in the same paragraph that "China's rate of urban homeownership is X%" (where X is a big number) and "In China, the state owns all urban land". How can they write that without realizing that both those things can't be meaningfully true at the same time?
Extremely well written!
On the Heritage Index of Economic Freedom, Hong Kong is often ranked as the most free economy on Earth. But all Hong Kong land is owned by the government.
In the U.S. we don’t see private ownership of land as a threat, but in Hong Kong the British did.
This complex topic is over my head. In my recent article “China is no Longer Communist” I deliberately dealt only with urban, industrial, work units and avoided rural collectives.
I would encourage everyone not to think that anything necessarily follows from the term "ownership". In other words, if all you are told is that X "owns" some land, you still don't know anything important about who controls and who benefits from the use of that land. A long-term leasehold is substantially the same thing as fee simple ownership; the only difference is that it isn't forever. But if we're talking about a 70-year leasehold, the value of the retained interest of the "owner" is trivial. Hong Kong's system arose because of its colonial status; at one point they had 999-year leaseholds. There is no significant difference between that and full ownership. In London today substantial amounts of real estate are actually held under very long-term leases that everyone talks about as ownership. I discuss all this in the article I linked to in the post: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2471449.
My pet peeve is people who will say in the same paragraph that "China's rate of urban homeownership is X%" (where X is a big number) and "In China, the state owns all urban land". How can they write that without realizing that both those things can't be meaningfully true at the same time?
I compare to “imminent domain “ in the U.S.. The land is mine until the government needs it