The Evergrande saga has captured global attention as one of the world’s most heavily indebted companies threatens to default on billions of dollars’ worth of debt. It’s not just foreign investors who are on tenterhooks, however. Land sales to real estate companies like Evergrande have been a vital source of revenue for cash-strapped local governments across China in recent years, which have used the funds to drive growth and economic innovation.  As the real estate sector’s woes deepen, this cash flow is drying up, driving a greater story of revenue decline across hundreds of cities in China, as illustrated by recent research from the Rhodium Group. The decline’s uneven pattern will exacerbate regional inequality by degrading public services in financially distressed regions, and could also transform China’s political economy at the local level. As more localities lose fiscal autonomy, their ability to experiment with new policies will diminish, reducing the chance