Relationship Between the Central Government and Local Governments & Urbanization

Abstract

We have examined the evolution of the relationship between the central government and local governments based on a scrutiny of the fiscal system and land administration of China in the previous chapters. On the whole, local governments have become more and more dependent on land development and land fiscal revenues in their pursuit of local development ever since the implementation of the tax-sharing system. The central government regulate the speed of local development and adjust inter-regional balance by imposing control over land quotas. Thus, the central government and local governments have gradually gained their relatively independent subject consciousness. Their relationship in the new era can be understood based on development objectives and local benefits.