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Rural households decisions towards income diversification : Evidence from a township in northern China

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  • Sylvie Démurger

    ()
    (HIEBS - Hong Kong Institute of Economics and Business Strategy - University of Hong Kong, GATE Lyon Saint-Etienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure de Lyon)

  • Martin Fournier

    ()
    (GATE - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - Ecole Normale Supérieure Lettres et Sciences Humaines)

  • Weiyong Yang

    ()
    (University of International Business and Economics (Beijing) - University of International Business and Economics (Beijing))

Abstract

Economic reforms in rural China have brought opportunities to diversify both within-farm activities and off-farm activities. Participation in these activities plays an important role in increasing rural households' income. This paper analyzes the factors that drive rural households and individuals in their income-source diversification choices for ten villages in Northern China. At the household level, we distinguish three types of diversification as opposed to grain production only : within farm (non- grain production) activities, local off-farm activities, and migration. At the individual level, we analyze the determinants of participation in three different types of jobs as compared to agricultural work : local off-farm employment, local self-employment and migration. At the household level, we find that land and labor availability stimulates on-farm diversification. Local off-farm activities are mostly driven by household wealth and credit constraints, while migration decisions strongly depend on the household age and composition. At the individual level, we find a clear gender and age bias in access to off-farm activities that are mostly undertaken by male and by young people. More surprisingly, education is found to play a role for accessing local wage employment but not in migration decision. As at the household level, the household assets position is found to strongly affect participation in any off-farm activity.

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Paper provided by HAL in its series Post-Print with number halshs-00435115.

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Date of creation: 2009
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Handle: RePEc:hal:journl:halshs-00435115

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Keywords: income-source diversification; agricultural households; off-farm employment; China;

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  1. Alan de Brauw & Scott Rozelle, 2006. "Reconciling the Returns to Education in Off-FarmWage Employment in Rural China," Department of Economics Working Papers 2006-03, Department of Economics, Williams College.
  2. de Brauw, Alan & Giles, John T., 2006. "Migrant Opportunity and the Educational Attainment of Youth in Rural China," IZA Discussion Papers 2326, Institute for the Study of Labor (IZA).
  3. de Brauw, Alan & Huang, Jikun & Rozelle, Scott & Zhang, Linxiu & Zhang, Yigang, 2002. "The Evolution Of China'S Rural Labor Markets During The Reforms," Working Papers 11984, University of California, Davis, Department of Agricultural and Resource Economics.
  4. Démurger, Sylvie & Gurgand, Marc & Li, Shi & Yue, Ximing, 2009. "Migrants as second-class workers in urban China? A decomposition analysis," Journal of Comparative Economics, Elsevier, vol. 37(4), pages 610-628, December.
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Cited by:
  1. Chavez, M.D. & Berentsen, P.B.M. & Oude Lansink, A.G.J.M., 2014. "Analyzing diversification possibilities on specialized tobacco farms in Argentina using a bio-economic farm model," Agricultural Systems, Elsevier, vol. 128(C), pages 35-43.
  2. Katsushi S. Imai & Jing You, 2013. "Poverty Dynamics of Households in Rural China," Discussion Paper Series DP2013-16, Research Institute for Economics & Business Administration, Kobe University, revised Jun 2013.

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