Has China’s New Round of Collective Forestland Tenure Reform Caused an Increase in Rural Labor Transfer?

Abstract

To investigate the rural labor transfer effects of China’s Collective Forestland Tenure Reform (CFTR), we employ binary probit models by using survey data of 694 households from China’s northern collective forest areas. The results reveal that the improved property rights, including rights for forestland use, disposition and beneficiaries, and refined tenure security under the CFTR generally have caused an increase in rural household labor transfer to the nonfarm sector. Besides, we find that forestry-dominated households’ risk perceptions on forestland reallocation and expropriation have significantly dampened rural labor transfer to the nonfarm sector. These can be explained by the fact that the strengthening of forestland property rights brought about by the CFTR can promote an increase in the forestland transfer rate and improve the forestland relocation efficiency. This, in turn, will lead to the liberation of the rural labor force, increase the non-agricultural employment rate of farmers, and ultimately lead to an increase in the rural labor transfer to the nonfarm sector. Therefore, these findings indicate that to motivate rural labor transfer to the nonfarm sector in the context of the Chinese government’s call for urbanization and other developing countries’ handling of similar circumstances, policymakers should further refine household forestland property rights and better protect forestland tenure security by continuing to improve related forestry policies.