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Machinery investment decision and off-farm employment in rural China

  • Ji, Yueqing
  • Yu, Xiaohua
  • Zhong, Funing

This paper investigates the endogenous linkages between farmers' machinery investment decision and off-farm employment in China. Both the theoretical model and the empirical results based on a survey of 453 households in Anhui Province indicate that agricultural labor input and small-sized machinery investment are gross complements rather than substitutes when machinery services are available in the market. Consequently, farmers with small-sized machinery are more likely to reduce their off-farm employment time. On the other hand, an increase in off-farm employment is more likely to reduce the possibility of possessing small-sized machineries mainly due to substitution effects of market machinery services.

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Article provided by Elsevier in its journal China Economic Review.

Volume (Year): 23 (2012)
Issue (Month): 1 ()
Pages: 71-80

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Handle: RePEc:eee:chieco:v:23:y:2012:i:1:p:71-80
Contact details of provider: Web page: http://www.elsevier.com/locate/chieco

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