Commercial Orientation and Productivity: The Role of Land Markets in Rural China

Jian Zhang, Ashok K. Mishra, Maximilian Koppenberg and Linyi Zheng

No 360674, 2025 AAEA & WAEA Joint Annual Meeting, July 27-29, 2025, Denver, CO from Agricultural and Applied Economics Association

Abstract: The study uses nationally representative panel datasets on rural Chinese households to examine the interrelationship between smallholders’ participation in land rental markets and their agricultural commercialization, while also evaluating the interactive effects of these market-oriented farming practices on agricultural land and labor productivity. We adopted bivariate tobit model, fixed effects models and instrument variable methods to solve the endogeneity problems. Results reveal a mutually reinforcing relationship between farm households’ land rental area and commercialization decisions. Furthermore, renting in farmland improves agricultural labor productivity while reduces land productivity. Agricultural commercialization has significantly improved farm households’ land and labor productivity. Finally, commercialization could positively moderate the effect of land renting on agricultural productivity. Policymakers should design policies and strategies to promote land rental market development and farmers’ commercialization that could improve labor and land productivity.

Keywords: Agricultural Finance; Farm Management (search for similar items in EconPapers)
Pages: 55
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea25:360674

DOI: 10.22004/ag.econ.360674

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