Rural Land Circulation and Common Prosperity in China: Spatial Econometric Evidence from Provincial Panel Data

This study examines the relationship between rural land circulation and common prosperity across 30 Chinese provinces over the period 2010–2022. We construct a multidimensional common prosperity index based on economic development, income distribution, public services, and social security using the entropy weight method. A Spatial Durbin Model (SDM) is employed to capture both local effects and interregional spillovers. The results show that rural land circulation exerts a positive and statistically significant impact on common prosperity. Effect decomposition further indicates that the influence is primarily driven by local (direct) effects, while spatial spillovers also play a meaningful role, suggesting that improvements in one region can generate positive externalities for neighboring areas. Additional analysis reveals three key channels through which land circulation is associated with common prosperity: improvements in agricultural productivity, increases in farmer income, and urbanization advancement. The effects exhibit clear regional heterogeneity, being strongest in central China, moderate in western regions, and statistically insignificant in the eastern provinces, reflecting diminishing marginal returns as land markets mature. Moreover, the impact of land circulation is more pronounced in regions with higher levels of digital economy development, indicating that digitalization enhances the efficiency and inclusiveness of land market transactions. These findings are robust to alternative spatial weight matrices, variable definitions, and sample adjustments. Overall, the results highlight the importance of regionally differentiated land circulation policies and the role of market integration in promoting balanced and inclusive development.