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The Impact of Nonfarm Activities on Agricultural Productivity in Rural China

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  • Wang, Ye
  • Wang, Chenggang
  • Pan, Suwen

Abstract

Although evidence abounds that the development of rural non-farm activities have increased rural household income and contributed to rural development, the underlying structure and mechanism of the linkage between agricultural productivity and non-farm activities is poorly understood. Using a unique panel dataset of Chinese villages, this article examines the mechanism by which non-farm activities influence agricultural productivity. I find that Chinese villages’ non-farm revenue has a significant positive effect on agricultural land productivity. Although non-farm activities do withdraw labor out of agriculture and therefore dampen land productivity, that negative effect is negligible in comparison with the land productivity improvement brought by nonfarm revenue-financed infrastructure capital investment.

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Bibliographic Info

Paper provided by Agricultural and Applied Economics Association in its series 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania with number 103605.

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Date of creation: 2011
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Handle: RePEc:ags:aaea11:103605

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Keywords: Rural non-farm activities; labor migration; agricultural productivity; infrastructure capital.; Agricultural and Food Policy; Productivity Analysis; O13; Q18;

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  1. de Brauw, Alan & Rozelle, Scott, 2008. "Migration and household investment in rural China," China Economic Review, Elsevier, vol. 19(2), pages 320-335, June.
  2. de Brauw, Alan & Giles, John, 2008. "Migrant Labor Markets and the Welfare of Rural Households in the Developing World: Evidence from China," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6085, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
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