Rising labour costs and the future of rubber intercropping in China

ABSTRACT

This study identifies the role of labour constraints in the use of rubber intercropping among smallholder farmers in Southwest China, drawing on a panel dataset collected from a sample of over 600 farm households in the Xishuangbanna Dai Autonomous Prefecture (XSBN). The analysis is based on two models: (i) a panel model to analyze the factors responsible for the decline in the use of rubber intercropping among smallholder farmers; (ii) an instrumental variable and endogenous switching model to assess the specific effects of off-farm labour market participation on the use of intercropping. We find a strong effect of the costs of labour on rubber intercropping. The decline in the use of intercropping has a potentially negative impact on environmental sustainability and endangers the government’s environmentally friendly rubber programme. The paper explores possibilities of how farmers can maintain intercropping under increasing labour constraints such as more engagement of elderly and female household members. This may require modifications in intercropping technologies and training. The paper recommends that the government should encourage the continuation of intercropping by a combination of well-balanced measures that include on-farm research, participatory farmer training, payment for environmental services, and effective monitoring.

KEYWORDS:

• Rubber
• intercropping
• labor costs
• smallholders
• China

JEL CODES:

• Q12
• Q15
• Q56

Disclosure statement

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

Notes

1 In China, 1 mu = 1/15 ha.

2 A third survey wave was carried out in 2019. However the data were not yet ready for use in this paper.

3 Estimated by person days of family labor input, and the minimum daily salary of field workers of rubber farming at local level based on farmers’ subjective assessment.

Additional information

Funding

We acknowledge the funding support from the National Natural Science Foundation of China, project number 71761137002. This study was also conducted in the framework of the Sino-German ‘SURUMER Project,’ funded by the Bundesministerium für Wissenschaft, Technologie und Forschung (BMBF), FKZ: 01LL0919A.

Notes on contributors

Shaoze Jin

Shaoze Jin is a research fellow in Research Center for Rural Economy, Ministry of Agriculture and Rural Affairs, China. His current research is on the multilevel dimensions of rural development, transformation, and inequality. His recent work has appeared in Climatic Change, Annals of Public and Cooperative Economics, China Agricultural Economic Review, among other journals. He holds a PhD in Development and Agricultural Economics from Leibniz Universität Hannover, Germany.

Shi Min

Shi Min is a professor of agricultural economics with the College of Economics and Management, Huazhong Agricultural University, China. He focuses on the researches on agricultural economics and rural development, food economics, and natural resource economics. He holds a PhD in Development and Agricultural Economics from Leibniz Universität Hannover, Germany.

Jikun Huang

Jikun Huang is a professor at the School of Advanced Agricultural Sciences, Peking University, China. He heads China Center for Agricultural Policy and New Rural Development Research Institute in Peking University. His research covers a wide range of issues on China's agricultural economics and rural development, including works on agricultural R&D policy, water and land policy, agricultural price and trade, food demand and supply projection, and economics of climate change.

Hermann Waibel

Hermann Waibel is a professor of agricultural and development economics with the School of Economics and Management, Leibniz Universität Hannover, Germany. His research focus is on household panel surveys and rural development in South East Asia.