Individual and social optima of rural land allocation by stakeholders: a case study on eco-fragile areas of northern China

Abstract

Divergences in preferences over the allocation of rural land among stakeholders are getting stronger with the decrease of rural land area. This paper analyses the degree of divergences among different stakeholders over the allocation of four types of land: cultivated land, grassland, forest and other land, and explores the optimal allocation from the social perspective of balancing economic and ecological benefits. Considering the heterogeneity of stakeholders that are concerned with land-use decisions, we distinguish four types of stakeholders, namely, ecological authorities, economic authorities, herders and farmers. The diverging preferences of these four stakeholder types over the different types of land use were quantified using the Analytic Hierarchy Process. Weights for each stakeholder type were derived for three scenarios: equal weights, weights based on income distribution and weights based on labour force distribution. Welfare analysis was employed then to determine the individual optimal allocation by maximising the utility function of each stakeholder type. Social optimal allocation was derived by maximising the social welfare function, which is the weighted sum of individual utilities. Tai Pusi County, located in an eco-fragile area of northern China, was taken as a case to present the empirical analysis. Individual optima revealed the degree of divergences among stakeholders and the social optima revealed the optimal allocation based on social welfare. Our results provide policy insights on how to achieve an efficient allocation of rural land, balancing the ecological and economic benefits of different stakeholders from different types of land.