A Configurational Analysis of Family Farm Management Efficiency: Evidence from China

Abstract

Family farms are the “most-desirable”; new-style agricultural production and management entities in China at this stage, as well as their production behaviors, play an important role in achieving sustainability in agricultural development. The scientific evaluation of family farm management efficiency and the identification of an effective path to the high efficiency of family farms with different resource endowments are critical for family farms to transform from quantitative growth to qualitative improvement and develop in a sustainable and healthy way. Based on the data from a rural fixed observation point of the Chinese Ministry of Agriculture and Rural Affairs, this study randomly selected representatives from 532 family farms from 27 provinces, municipalities, and autonomous regions in China as research objects; calculated their total factor productivity based on the DEA model; and employed the Qualitative Comparative Analysis (QCA) method to identify the configuration models for a high total factor productivity, which combines the factors of land investment, capital investment, labor investment, education level of farm leaders, land transfer years, the introduction of new technology and new equipment, and financial support. It is found that the average efficiency of family farms in China is not high yet, and both the pure technical efficiency and scale efficiency have great room for improvement. The efficiency of family farms is not determined by one single condition, but by the combinations of multiple factors. The introduction of new technology and new equipment, long land transfer period, high input of production and labor, and financial support are the driving forces to improve the efficiency of family farms. This demonstrates that although the current family farms are still in the cultivation stage of capital and labor-intensive investment, they do not mainly rely on traditional agricultural productions such as labor to achieve high efficiency. The managerial implications are as follows. First, the strategy of intensive and efficient management instead of the blind expansion of land scale should be considered, the full play to the role of family labor while controlling the scale of employees is highly suggested. Second, attention should be paid to the accumulation of the human capital of family farm practitioners, which implies that more highly educated people for family farm management, as well as high-technical-skilled farm operators, should be employed. Third, it is necessary to create a good institutional environment for the development of family farms and to increase financial support such as credit loans for family farms.