Analysis Of The Economics Of Urban Demolition Compensation Mechanism

The paper analysed the development and reformation of the city-land eminent domain institution in the neoclassic economics framework, based on the histories and practices in Shanghai, and then gave some proposition to the improvement of the institution.First of all, the paper systematically sorted out the history of Shanghai's city-land eminent domain institution since 1970s, which, based on the important time point, could be categorized as eminent domain under zero-land-cost institution, the eminent domain under land transferring-allowed institution, the eminent domain after reformation and opening, the eminent domain after real estate market-orientation reformation and the eminent domain after the enforcement of the Property Law. After all these, the paper then sorted out all the related polices in Shanghai.Then, the paper summarized the related studies both in and out of China. Because of the speciality of Chinese land system, the studies out of China mainly focused on the problems in their institution background which did not relate to Chinese problems. While in looking back to the related studies in China, most of which are in the domain of law studies and not thorough as well as systematic enough in economic studies. The most related economic studies are those using game theory to analyse the development of the institution, while the studies under the framework of neoclassic economics are rare.The third, the paper construct the neoclassic model between developer and related residence, by which analysed how the old eminent domain institution went to ruin finally. Basing on the same model, the paper studied the impact of the decision of residence or developer and the total cost of the eminent domain by the difference of land scale, the disparities between the related residence and the time cost.Fourthly, rooted in the analysis of the constructed neoclassic model, the paper successfully explained the reason of formation from old eminent domain institution to the new eminent domain institution, which stressing the reasons of the death of the old one and the reasons to the process of reformation.The fifth, the paper analysed the reasons of the success of the new eminent domain institution from the three viewpoint, including the path-relying mechanism, game theory analysis conclusion and the public choice theory under the neoclassical economics analysis framework.And then, to give some proposition to the improvement of Shanghai's eminent domain mechanism which focusing on the using of new institution through the viewpoint of individual choice under the framework of public choice theory and the propose the system of how to use the related mechanism. At the same time, the paper gave an innovated method in Shanghai eminent domain institution which could be a supplement to the existing institution and to better the relationship between the government system and the market system.And finally, the paper gave some direction and suggestion to the further studies of the theme which included the normalization of the model, the more data analysis and econometrics analysis of the theme and the argument suggested in the paper, the simplifying of the mechanism in using the new institution and the demonstration of the practicality of the innovated eminent domain method.