Beginning as a response to perceived unfairness in economic policies, the US-China trade war was initiated in 2018 under president Donald Trump to reduce trade deficit through punitive tariffs. Tariffs were followed by heightened restrictions on China’s access to technology products and foreign investments. The tariffs, restrictions, and sanctions colloquially known as the trade war, highlighted and negatively impacted the land-based finance of Chinese cities. Land-based finance refers to the tax-sharing and land reforms that generated much of local government’s revenue streams and relied upon a robust and growing real estate market.
In a new paper, an interuniversity team of researchers seeks to model and understand how the US-China trade war impacted local housing markets and land-based finance, how those impacts varied across cities based on their size and other economic sectors, and what this might mean for policymakers seeking to increase the urban resilience of Chinese cities.
Authors include: Beijing Wuzi University’s Boning Li; National University of Singapore’s Wen-Chi Liao; Central University of Finance and Economics’s Weizeng Sun and Yongxuan Zeng; and MIT’s Siqi Zheng.