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How reliable are cultivated land assets as social security for Chinese farmers?

Author

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  • Wang, Yahui
  • Li, Xiubin
  • He, Huiyan
  • Xin, Liangjie
  • Tan, Minghong

Abstract

The social security theory of cropland, which considers cropland as being the lifeblood or having a social security function, has been accepted in political and academic circles in China since the 1980s. This idea suggests that cropland assets are the most important means of social security for farmers and thus that cropland cannot be marketwise. In reality, the function of cropland as social security depends on its asset value. In recent years, the phenomena of rent-free land transfer and land abandonment have become increasingly prominent in mountainous areas, and the asset value of cropland in such areas has experienced a great decline. The study regards cropland with contract rights as an asset for farmers and systematically estimates the asset value of cropland as social security by using rural permanent observation sites and cost-benefit data compilation of national agricultural products from 1986 to 2015. For most farmers, their cropland has essentially lost original social security function, and they can no longer support basic livelihood demands if they rely only on contracted cropland and the social security theory of cropland must be re-examined. It is difficult to stand against the market-oriented reform of land element according to the above argue, which provides an opportunity for the transfer of cropland contract rights within a certain range. Moreover, it is difficult to dispose the land management right as collateral for the bank and the loan amount of cropland as collateral can be obtained is few; this also requires a moderate transfer of cropland contract rights. To prevent land concentration and merger in rural areas, the government should liberalize the transfer of land contract rights in an appropriate and orderly manner. First, a market access system should be established; for example, cropland contract rights may be only allowed to be transferred among farmers in the early stage. Second, land contract rights may be transferred within counties and then gradually at the levels of prefecture-level cities or provincial level.

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  • Wang, Yahui & Li, Xiubin & He, Huiyan & Xin, Liangjie & Tan, Minghong, 2020. "How reliable are cultivated land assets as social security for Chinese farmers?," Land Use Policy, Elsevier, vol. 90(C).
    • Handle: RePEc:eee:lauspo:v:90:y:2020:i:c:s0264837719307070
    DOI: 10.1016/j.landusepol.2019.104318
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