Does Public Investment Spur the Land Market?: Evidence from Transport Improvement in Beijing

Wu, W. (2012) Does Public Investment Spur the Land Market?: Evidence from Transport Improvement in Beijing. Discussion Paper. Spatial Economics Research Centre, London School of Economics, London, UK.

Abstract

Over 140 billion CNY (1GBP=10CNY) has been spent between 2000 and 2012 in Beijing on the construction of new rail transit lines. This massive public investment allows me to examine the consequences of transport improvements for land prices near rail stations. Using unique vacant parcel-specific data, I estimate the significant heterogeneity in the capitalization effects of rail transit development for multiple land uses in Beijing urbanised area. The results show that these transport improvements, identified by the parcel-station distance reductions, give rise to sizeable price premiums in the local residential and commercial land markets. Strikingly, the difference between the increase in the value of residential and commercial land parcels are not distributed evenly. These findings lend to support the evidence that public investment has an essential role to play in spurring the spatially targeted land market and provide implications for further land and transport policy making in China.

• Item Type: Research Reports or Papers (Discussion Paper)
• Additional Information: SERC Discussion Paper No. 116
• Status: Published
• Glasgow Author(s) Enlighten ID: Wu, Dr Wenjie
• Authors: Wu, W.
• College/School: College of Social Sciences > School of Social and Political Sciences > Urban Studies
• Publisher: Spatial Economics Research Centre, London School of Economics