How Does Farmland Tenure Security Affect Rural Household Income? Empirical Evidence of China’s Survey Data

Abstract

A stable farmland tenure can optimize farmers’ allocation of production factors and then determine the income level and structure of farmers. In recent years, the reform of China’s farmland tenure system had been making efforts to strengthen the stability of farmland tenures. Will the farmland tenure security restrict agricultural development? Based on the data of the 2018 China Labor Dynamics Survey (CLDS), this paper empirically analyzes the impact of farmland tenure stability on rural household income and its mechanism. The results showed that the stability of land rights increased the per capita total income, wage income and agricultural productive income of farmers significantly. The stability of the farmland tenure significantly increased the income of rural households in plain areas and the income of rural households in villages with highly mechanied; additionally, employment opportunities increased significantly. The mechanism analysis showed that the stability of the farmland tenure had a significant positive effect on the total income of farmers by promoting the division of labor and agricultural investment. On this basis, this paper puts forward measures such as strictly controlling the readjustment of agricultural land, improving the rural labor market and financial market, and guiding nonplain areas to develop tertiary industry according to local conditions.