IDEAS home Printed from
   My bibliography  Save this paper

Endowments, Technology, and Factor Markets: A Natural Experiment of Induced Institutional Innovation from China's Rural Reform


  • Justin Yifu Lin



The induced institutional innovation hypothesis postulates that new institutions are innovated to exploit profitable opportunities arising from institutional disequilibrium. The removal of legal restrictions on factor market exchanges after recent reforms in China resulted in institutional disequilibrium. This paper utilizes data from a household survey in China to explore (i) the relationship between the emergence of land, labor, and rental markets in a region and the distribution of factor endowments across rural households in that region, and (ii) the impact of hybrid rice on the emergence of factor markets in that region. The results are consistent with the induced institutional innovation hypothesis.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Justin Yifu Lin, 1993. "Endowments, Technology, and Factor Markets: A Natural Experiment of Induced Institutional Innovation from China's Rural Reform," UCLA Economics Working Papers 689, UCLA Department of Economics.
  • Handle: RePEc:cla:uclawp:689

    Download full text from publisher

    File URL:
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    1. Robert J. Barro, 1991. "A Cross-Country Study of Growth, Saving, and Government," NBER Chapters,in: National Saving and Economic Performance, pages 271-304 National Bureau of Economic Research, Inc.
    2. Kenneth Arrow, 1962. "Economic Welfare and the Allocation of Resources for Invention," NBER Chapters,in: The Rate and Direction of Inventive Activity: Economic and Social Factors, pages 609-626 National Bureau of Economic Research, Inc.
    3. Stern, Nicholas, 1991. "The Determinants of Growth," Economic Journal, Royal Economic Society, vol. 101(404), pages 122-133, January.
    4. Deepak Lal, 1992. "Industrialization Strategies and Long Term Resource Allocation," UCLA Economics Working Papers 640, UCLA Department of Economics.
    5. Smith, Alasdair & Venables, Anthony J., 1988. "Completing the internal market in the European Community : Some industry simulations," European Economic Review, Elsevier, vol. 32(7), pages 1501-1525, September.
    6. Feder, Gershon, 1983. "On exports and economic growth," Journal of Development Economics, Elsevier, vol. 12(1-2), pages 59-73.
    7. Leff, Nathaniel H, 1978. "Industrial Organization and Entrepreneurship in the Developing Countries: The Economic Groups," Economic Development and Cultural Change, University of Chicago Press, vol. 26(4), pages 661-675, July.
    8. Heller, Peter S. & Porter, Richard C., 1978. "Exports and growth : An empirical re-investigation," Journal of Development Economics, Elsevier, vol. 5(2), pages 191-193, June.
    9. Demsetz, Harold, 1969. "Information and Efficiency: Another Viewpoint," Journal of Law and Economics, University of Chicago Press, vol. 12(1), pages 1-22, April.
    10. Edwards, Sebastian, 1992. "Trade orientation, distortions and growth in developing countries," Journal of Development Economics, Elsevier, vol. 39(1), pages 31-57, July.
    11. Jung, Woo S. & Marshall, Peyton J., 1985. "Exports, growth and causality in developing countries," Journal of Development Economics, Elsevier, vol. 18(1), pages 1-12.
    12. Robert E. Baldwin, 1988. "Trade Policy Issues and Empirical Analysis," NBER Books, National Bureau of Economic Research, Inc, number bald88-2, January.
    13. Jagdish N. Bhagwati, 1978. "Anatomy and Consequences of Exchange Control Regimes," NBER Books, National Bureau of Economic Research, Inc, number bhag78-1, January.
    14. T. N. Srinivasan, 1989. "Recent Theories of Imperfect Competition and International Trade: Any Implications for Development Strategy?," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 24(1), pages 1-23, July.
    15. Hayek, F. A., 2011. "The Constitution of Liberty," University of Chicago Press Economics Books, University of Chicago Press, number 9780226315379 edited by Hamowy, Ronald, March.
    16. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Beekman, Gonne & Bulte, Erwin H., 2012. "Social norms, tenure security and soil conservation: Evidence from Burundi," Agricultural Systems, Elsevier, vol. 108(C), pages 50-63.
    2. Tong, Haizhi, 2002. "Chinese Regional Agricultural Productivity In The 1990'S," 2002 Annual meeting, July 28-31, Long Beach, CA 19804, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Kazianga, Harounan & Masters, William A. & McMillan, Margaret S., 2014. "Disease control, demographic change and institutional development in Africa," Journal of Development Economics, Elsevier, vol. 110(C), pages 313-326.
    4. Binoy Goswami, 2016. "Overcoming farm size induced constraints through endogenous institutional innovations: findings from a field study in Assam plains, India," Economics Bulletin, AccessEcon, vol. 36(1), pages 411-428.
    5. Haizhi Tong & Lilyan E. Fulginiti, 2005. "Chinese Regional Agricultural Productivity in the 1990'a," Others 0502012, EconWPA.
    6. David K. Lambert & Elliott Parker, 1998. "Productivity in Chinese Provincial Agriculture," Journal of Agricultural Economics, Wiley Blackwell, vol. 49(3), pages 378-392.

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cla:uclawp:689. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (David K. Levine). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.