Land use change and economic growth in urban China: A structural equation analysis

Land use change is not only the consequence of economic growth but also its direct and indirect driver. Based on official land use change data from 2004 to 2008, this study found substantial land use changes in China, with considerable cultivated land conversion into urban, industrial and transportation purposes. Correlation analysis shows a strong association between land use change and absolute GDP expansion. Structural equation analysis indicates that economic growth drives land use change. Industrial land expansion directly stimulates economic growth. Land has been successfully used as a tool to attract foreign investments and to sustain infrastructure investments, indirectly triggering economic growth. The findings suggest that land is not a simple factor of production but a strategic tool for economic development in urban China.