Impact of Off-Farm Employment on Farmland Transfer: Insight on the Mediating Role of Agricultural Production Service Outsourcing

Abstract

Understanding the effects of the off-farm employment of rural laborers on agricultural land use is essential to promote farmland transfer and enhance rural development in China. This study aims to investigate the direct impact of off-farm employment on farmland transfer and the mediating role of agricultural production services outsourcing (APSO) by using the Probit and Tobit model approaches. This study uses field survey data of 960 rural households in 12 counties of the four main grain producing provinces of China. Findings of this study show that off-farm employment has a significant positive effect on the transfer of land out from households and a significant negative effect on the transfer of land into households. Furthermore, APSO has a significant mediating effect on the influence of off-farm employment on farmland transfer behavior. Specifically, APSO can reduce the positive impact of off-farm employment on agricultural land transfer and weaken the negative impact of off-farm employment on agricultural land transfer-in. The findings of our study also show that the mediating effect of different outsourcing of production links services on the impact of off-farm employment on agricultural land transfer is heterogeneous. Based on the findings of the study, it is contended that the APSO can reshape the supply and demand structure of rural land rental markets and policymakers should focus on the role of ASPO in shaping policies to promote land transfer.