Land Transfer or Trusteeship: Can Agricultural Production Socialization Services Promote Grain Scale Management?

Abstract

Grain Scale Management (GSM) is a crucial factor in ensuring national food security. However, in countries facing rigid resource constraints and complex land tenure relationships, the strategy of promoting large-scale grain management through land management rights transfer may not be sustainable. Therefore, based on the traditional agricultural division of labor theory, we analyze the mechanism and rationality of Agricultural Production Socialization Services (APSS) with scale characteristics to promote GSM and propose a new approach to GSM with empirical evidence from China. Using county-level panel data from Hubei province spanning from 2010 to 2021, we construct a multi-period double difference model based on the difference in the time of the establishment of pilot agricultural production socialization service counties in Hubei province. Our empirical results demonstrate the role of APSS in promoting GSM at the macro level. Specifically, the establishment of pilot counties for APSS significantly improves the level of local GSM. Furthermore, our study reveals that the degree of local financial intervention, regional industrial structure, and regional topography have heterogeneous effects on the implementation of the policy.