The Land System and the Rise and Fall of China’s Rural Industrialization: Based on the Perspective of Institutional Change of Rural Collective Construction Land

China’s rural industrialization, which flourished in the 1980s, has suddenly declined since mid-1990s. Based on perspective of institutional change collective construction land, this paper discusses reasons behind rise and fall industrialization. Using empirical tests provincial panel data from 1987 to 1997, it is found that 1980s mid-1990s, government relaxed regulation land allowed its transfer, was basis for rapid industrialization with township village enterprises (TVEs) as main form. Furthermore, takes government’s policy prohibiting circulation mid-1990s breakthrough point, uses “Land Administration Law China” promulgated 1998 a quasi-natural experiment examine causal relationship between restricting decline TVEs. It restrictions caused by implementation law significantly hindered development After Land Law, areas affected more law, scale their TVEs shrunk even more. The analysis shows deepening reform system property rights agricultural ensuring farmers’ are important ways revitalize areas.