Will farmland renting out boost rural households’ income? Evidence from China’s rural areas

ABSTRACT

This paper estimates the effect of renting out farmland on rural households’ income through a difference-in-differences (DID) approach, using data from China Family Panel Studies (CFPS). Our findings support the income growth effect of farmland renting out, which is confirmed by a series of robustness tests. Additionally, the mechanism tests indicate that both the farmland rental income proportion in the total income and the rural household members’ probability of non-farm work significantly increase after farmers rent out their farmland. Our study helps to explore the market-based allocation of farmland and provides Chinese evidence and reference for the reform of rural land systems in emerging economies.

KEYWORDS:

• Farmland renting out
• rural households’ income
• DID approach
• mediation effect

JEL CLASSIFICATION:

• D13
• Q15
• Q18
• Q24

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

¹ Referring to https://www.gov.cn/gongbao/content/2014/content_2786719.htm for more information.

² Referring to http://www.pbc.gov.cn/goutongjiaoliu/113456/113469/2874980/index.html for more information.

Additional information

Funding

This study is supported by the Special Research Project in Fundamental Research Funds (Humanities and Social Sciences) of Xi’an Jiaotong University (Grant No. SK2024034).