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Land Rental Market Participation and Its Impact on Fixed Investment and Household Welfare: Evidence from Chinese Apple Production Sites

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  • Jianyun Hou

    (College of Economics and Management, Northwest Agricultural &Forestry University, Yangling 712100, Shaanxi, China
    Department of Forestry, Michigan State University, East Lansing, MI 48823, USA)

  • Xuexi Huo

    (College of Economics and Management, Northwest Agricultural &Forestry University, Yangling 712100, Shaanxi, China)

  • Runsheng Yin

    (Department of Forestry, Michigan State University, East Lansing, MI 48823, USA)

Abstract

Using a large dataset from the specialized apple production sites of China and multiple econometric methods, we identify the main determinants of farmers’ land rental decisions and the effects from renting land in on their investment and economic welfare. It is found that having more effective cultivated land before renting in has a significantly negative effect on the land rented in, that households with rich land endowments or large areas of land rented in usually invest more in fixed assets, and that efficient provisions of credit and insurance are helpful to encourage investments in fixed assets. As a result, renting in land generates gains in terms of agricultural income, total income, and productive expenditure.

Suggested Citation

  • Jianyun Hou & Xuexi Huo & Runsheng Yin, 2017. "Land Rental Market Participation and Its Impact on Fixed Investment and Household Welfare: Evidence from Chinese Apple Production Sites," Sustainability, MDPI, vol. 9(11), pages 1-15, October.
    • Handle: RePEc:gam:jsusta:v:9:y:2017:i:11:p:1961-:d:116595
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    4. Shuangjin Wang & Yuan Tian & Xiaowei Liu & Maggie Foley, 2019. "How Farmers Make Investment Decisions: Evidence from a Farmer Survey in China," Sustainability, MDPI, vol. 12(1), pages 1-19, December.
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    6. Wang, Qian & Li, Fan & Heerink, Nico & Yu, Jin & Fleskens, Luuk & Ritsema, Coen J., 2023. "Land Rental Markets, Specialization and Rural Household Income: Evidence from the North China Plain," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 48(3), September.
    7. Qiangqiang Zhang & Beibei Yan & Xuexi Huo, 2018. "What Are the Effects of Participation in Production Outsourcing? Evidence from Chinese Apple Farmers," Sustainability, MDPI, vol. 10(12), pages 1-15, November.

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