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Land rental market and rural household efficiency in China

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  • Chavas, Jean Paul
  • Shi, Guanming
  • Meng, Xiangyi

Abstract

Well-functioning factor markets play an important role in improving the performance of the agricultural sector. Our paper examines both technical and allocative efficiencies at the household level, with an application to a cross-section sample of rural households in three provinces of China in 2009. In a first step, we use nonparametric methods to estimate household efficiency. In a second step, we examine econometrically the role of land rental market and its linkages with household-level efficiencies. We find that participation in the land rental market does not affect technical efficiency but has large positive effects on allocative efficiency. This stresses the need to distinguish between technical efficiency and allocative efficiency in the analysis of land tenure issues. The improvements in allocative efficiency from land-leasing contribute to significant increases in household income in rural China.

Suggested Citation

  • Chavas, Jean Paul & Shi, Guanming & Meng, Xiangyi, 2022. "Land rental market and rural household efficiency in China," Environment and Development Economics, Cambridge University Press, vol. 27(2), pages 103-119, April.
    • Handle: RePEc:cup:endeec:v:27:y:2022:i:2:p:103-119_1
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    Cited by:

    1. Dungang Zang & Sen Yang & Fanghua Li, 2022. "The Relationship between Land Transfer and Agricultural Green Production: A Collaborative Test Based on Theory and Data," Agriculture, MDPI, vol. 12(11), pages 1-19, November.
    2. Gang Li & Xufeng Cui & Lan Pan & Yufei Wang, 2023. "Land Transfer and Rural Household Consumption Diversity: Promoting or Inhibiting?," Land, MDPI, vol. 12(1), pages 1-16, January.
    3. Yuanjie Zhang & Shichao Yuan & Jian Wang & Jian Cheng & Daolin Zhu, 2022. "How Do the Different Types of Land Costs Affect Agricultural Crop-Planting Selections in China?," Land, MDPI, vol. 11(11), pages 1-18, October.

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