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The Impact of Property Rights on Households’ Investment, Risk Coping, and Policy Preferences: Evidence from China

2003/07/01 by Klaus Deininger, Songqing Jin
Agricultural and Biological Sciences · Social Sciences · #Land Rights and Reforms #Agricultural risk and resilience #China's Socioeconomic Reforms and Governance

paper · doi:10.1086/376885

Abstract

Even though it is widely recognized that
\n giving farmers more secure land rights may increase
\n agricultural investment, scholars contend that, in the case
\n of China, such a policy might undermine the function of land
\n as a social safety net and, as a consequence, not be
\n sustainable or command broad support. Data from three
\n provinces, one of which had adopted a policy to increase
\n security of tenure in advance of the others, suggest that
\n greater tenure security, especially if combined with
\n transferability of land, had a positive impact on
\n agricultural investment and, within the time frame
\n considered, led neither to an increase in inequality of land
\n distribution nor a reduction in households' ability to
\n cope with exogenous shocks. Household support for more
\n secure property rights is increased by their access to other
\n insurance mechanisms, suggesting some role of land as a
\n safety net. At the same time, past exposure to this type of
\n land right has a much larger impact quantitatively,
\n suggesting that a large part of the resistance to changed
\n property rights arrangements disappears as household
\n familiarity with such rights increases.

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