As Macau SAR government regards gaming industry as its main public finance source and the core driving force for city’s development, expansion is needed to utilize the resources effectively to attract oversea investors for further growth. Land disposal is used as one of the administrative tools for the liberalization of the gaming industry. Through our analysis, it is found that land disposals were not made through the conventional market mechanism with the highest and best market values.
Land market in Macau is not regarded as totally market failure as it is planned for this macro goal (government selects the public goods of “gaming city expansion” by changing gaming provision from an imperfect market toward a more perfect one as a conscious public choice). But some mis-allocations of land use, corruptions and other defects happened in past few years are due to the repulsion resulted from incompatible legislation and monitoring/enforcement system with the intense speed of development. Also, the effectiveness of this policy highly depends on the integrity and “GuanXi”.
If land administration is just used for achieving one single goal for the gaming industry, then the end product will be more certain and persuadable. However, as several objectives (social stability, lobbying of local interests and income redistribution) need to be completed at the same time, the contradictory causes and effect relationship would make the result highly unpredictable. The government is advised not to be so aggressive in this transition period especially when the resources are not well-established in Macau and the true public preference is not easy to quantify. Otherwise, some social problems are likely to be expected such as middle class distress and polarization especially where institutional defects allow costs to be passed on to others (without proper punishment and monitoring mechanism) in Macau’s current political environment (SAR ideology).
|Keywords:||Macau, Land Administration System, Premium, Private Negotiation, Public Good, Public Choice Consideration, Gaming City|
PhD Candidate, Department of Real Estate and Construction, University of Hong Kong, Hong Kong, Hong Kong
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