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Hazards Of Expropriation:Tenure Insecurity And Investment In Rural China

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  • Jacoby, Hanan G.
  • Li, Guo
  • Rozelle, Scott

Abstract

This paper uses household data from Northeast China to examine the link between investment and land tenure insecurity induced by China's system of village-level land reallocation. We quantify expropriation risk using a hazard analysis of individual plot tenures and incorporate the predicted "hazards of expropriation" into an empirical analysis of plot-level investment. Our focus is on organic fertilizer use, which has long lasting benefits for soil quality. Although we find that higher expropriation risk significantly reduces application of organic fertilizer, a welfare analysis shows that guaranteeing land tenure in this part of China would yield only minimal efficiency gains.

Suggested Citation

  • Jacoby, Hanan G. & Li, Guo & Rozelle, Scott, 2002. "Hazards Of Expropriation:Tenure Insecurity And Investment In Rural China," Working Papers 11960, University of California, Davis, Department of Agricultural and Resource Economics.
    • Handle: RePEc:ags:ucdavw:11960
    DOI: 10.22004/ag.econ.11960
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    Keywords

    Land Economics/Use;

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