Urban restructuring in China’s emerging market economy: towards a framework for analysis


The objective of this article is to speculate on the urban restructuring process in China’s transition to a market economy. Previous studies suggest that a broad theoretical framework is much needed to develop hypotheses for further empirical studies. This paper draws its insights from relevant studies on contemporary capitalist cities, in particular, political economy analysis of the urban process and capital switching, the structure of building provision and the creation of a rent gap, and institutional analysis of property rights. Summarily, it suggests that the basic logic of production in the context of a socialist city requires a specific way of coordinating — through economic planning and a specific configuration — the state work‐unit system. Manifested in the production of the built environment was project‐specific development. The structural tendency to disinvest in developed land has engendered a rent gap, which has laid the foundation for the phase of redevelopment in reforming socialist economies. Urban restructuring in the recent emerging market economy, which mainly involves decentralization, reorganizing the production of the built environment, and an increasing local‐global link through overseas capital, is understood through this perspective. The post‐reform built environment is characterized by land‐use restructuring and polycentric development. It is argued that the physical reshaping of Chinese cities can be understood with respect to the redefinition of property rights, hence, capturing the rent gap by the main actors — state work‐units, municipalities, the central state, real‐estate investors, original residents and farmers. By its nature, the process favours big builders who have either de facto rights over existing urban land property or huge capital that enables them to ‘wipe out’ small owners. Western experience of gentrification reminds us that social problems may be created during the process, which calls for continuing insights to shed light on urban restructuring in post‐reform China.