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Do fragmented landholdings have higher production costs? Evidence from rice farmers in Northeastern Jiangxi province, P.R. China

  • Tan, Shuhao
  • Heerink, Nico
  • Kruseman, Gideon
  • Qu, Futian

Land fragmentation is generally seen as an obstacle to agricultural productivity improvements, but it can also facilitate labor smoothing and risk diversification. In this paper we examine the impact of land fragmentation on the variable production costs of rice farmers in three villages in Jiangxi Province, P.R. China. We find that changes in the number of plots and plot size distribution, as measured by the Simpson index, do not affect total production costs per unit output, but cause a shift between cost categories. Farmers with more and smaller plots tend to use more labor and fewer modern technologies as compared to farmers with fewer and larger plots. Other aspects of land fragmentation, however, do affect total production costs. A reduction of the average distance to plots and an increase in farm size decrease the total production costs per ton. We conclude that land consolidation programs can only contribute to the joint policy goals of increasing agricultural production capacity and reducing the rural labor surplus, if such programs are accompanied by measures aimed at creating alternative market opportunities and at providing appropriate off-farm employment opportunities.

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Article provided by Elsevier in its journal China Economic Review.

Volume (Year): 19 (2008)
Issue (Month): 3 (September)
Pages: 347-358

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Handle: RePEc:eee:chieco:v:19:y:2008:i:3:p:347-358
Contact details of provider: Web page: http://www.elsevier.com/locate/chieco

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  1. Guang Wan & Enjiang Cheng, 2001. "Effects of land fragmentation and returns to scale in the Chinese farming sector," Applied Economics, Taylor & Francis Journals, vol. 33(2), pages 183-194.
  2. Blarel, Benoit, et al, 1992. "The Economics of Farm Fragmentation: Evidence from Ghana and Rwanda," World Bank Economic Review, World Bank Group, vol. 6(2), pages 233-54, May.
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  4. Jabarin, Amer S. & Epplin, Francis M., 1994. "Impacts of land fragmentation on the cost of producing wheat in the rain-fed region of northern Jordan," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 11(2-3), December.
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  7. Heston, Alan & Kumar, Dharma, 1983. "The persistence of land fragmentation in peasant agriculture: An analysis of South Asian cases," Explorations in Economic History, Elsevier, vol. 20(2), pages 199-220, April.
  8. Huffman, Wallace E., 1991. "Agricultural Household Models: Survey and Critique," Staff General Research Papers 11008, Iowa State University, Department of Economics.
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