Allocative efficiency or misallocation of resources? The emergence of forestland rental markets and the forest devolution reform in China

Yuanyuan Yi, Fredrik Carlsson, Gunnar Köhlin and Jintao Xu

European Review of Agricultural Economics, 2023, vol. 50, issue 2, 395-420

Abstract: This paper evaluates whether the devolution reform of forestland to household management improves allocative efficiency and household welfare through participation in forestland rental markets. Using a household panel dataset from three Chinese provinces, we find positive effects of the emerging forestland rental markets: with the reform, forestland was transferred to forestland-constrained and labour-rich households and households with higher levels of productivity in forestry. Participation in forestland rental markets increases household per-capita income and decreases the likelihood of income falling below the poverty line. We do not find any support for forestland captured by land-richer, wealthier, larger or powerful households.

Keywords: allocative efficiency; household welfare; forestland rental markets; collective forest tenure reform; China (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (3)

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