Chapter 9 Conclusion
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This book has three main elements, as follows. The framework of the New Institutional Economics was adopted to analyse the property rights in land under the LURs system. In particular, the role of the state in the land market was examined to explore the impacts of government intervention on land markets. This book reveals that the state has taken advantage of the ambiguous property rights in land, somewhat ignoring issues of betterment and worsenment, to achieve wide discretion in development control in pursuit of the objective of rapid urban growth. Moreover, constrained by the high cost of measures such as establishing an integrated GIS system, and improving valuation and management skills, issues of capturing betterment and compensating worsenment have not been high on the agenda of the government. The analysis of property rights evolution indicates that an imprecise property rights system might be a second-best institution under the transitional period in China when the cost of well-defined property rights is too high to afford. Moreover, it provides some evidence that property rights in land have been moving towards more precise definition, consistent with the economic theories that consider clearly defined property rights to be essential for economic growth. In order to establish a fairer and more efficient land market, however, further institutional changes and clarification of property rights in land are inevitable.

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