Land commodification and hukou policy innovation in China: evidence from a survey experiment

Abstract This article examines how land commodification has changed the dynamics of hukou policy innovations in China. The increasing demand of local governments for land to fuel industrialization and urbanization creates appreciating land values, which in turn lead villagers to update their belief about the value associated with their rural hukou. This is perhaps especially the case in economically more developed areas where rural benefits, many of which involve land, induce villagers to value their rural hukou and to be more resistant against land expropriation. This leads local governments, many of which are fiscally dependent on land, to provide more generous land-taking compensation, including an urban hukou. Drawing on an original survey experiment, we find that villagers are less willing to give up their land and change their hukou status from rural to urban when they are not provided with pension benefits and when their collective yearly dividends are discontinued. Our findings suggest the difficulties in implementing the ‘land for hukou’ policy innovations in China.