Inequality and small landholdings: Path dependence, land use and wellbeing

Abstract

China economic reform was initiated from rural land tenure reforms, leading up to four decades of fast economic growth. Small but more unequal land holding has been viewed as a dilemma for future development. Using data from rural households in three provinces, this paper attempts to quantitatively measure and examine land holding inequality between farmland and woodland across different regions. It was argued that the paths of land tenure reforms could play an important role: all farmland was allocated to households via administrative mechanism according to household size at the beginning of the economic reforms while woodland was allocated to households from the collective using market mechanism. The inequality between farmland and woodland also come from land uses because farmland is primarily used for food production for own consumption whereas woodland is used to produce products for sale. The determinants of the current holding size of land were compared and investigated. The role of wellbeing like household income is found statistically significant in forestland but not farmland. In contrast, the size of household is found statistically significant in farmland but not forestland.