Land in China is generally categorised in rural and in urban land. Whereas rural land is collectively owned by rural communities, urban land is owned by the government and generally leased to companies and/or individuals for 70 years. In the current urbanisation process, rural farmland is often converted to urban land and re-sold to development companies at a higher price, whereas the financial compensation for rural housing (village) land is often too high for conversion into urban land. As a result, so-called “urban villages” can be found on the urban fringes of almost all Chinese cities.
The implications of this phenomenon and the functions of urban villages in the wider urban economy have been researched by Urbanlogic, and the results were presented i.a. at the 2012 Shanghai Archi-Fair Eco Cities Forum.