Promoting Sustainability: Land Transfer and Income Inequality Among Farm Households

Abstract

The United Nations Sustainable Development Goals emphasize the dangers of inequality and initiatives on how to reduce it. Income inequality is an important part of this and can cause many social problems. This study aims to investigate the impact of land transfer on income inequality of Chinese farm households and its mechanism of action. This study empirically analyzes the impact of land transfer on farm household income inequality based on the OLS model using 27,134 samples from the 2018–2020 China Family Panel Study (CFPS) data. The study finds that land transfer can effectively reduce income inequality among farm households. However, only land transfers out affect income inequality; the effect of land transfers in is not significant. At the same time, there is some heterogeneity in the impact of land transfers on farm household income inequality. The effect is greater in the east and west than in the center. The effect is greater in the north than in the south. The role is greater in food-producing areas than in non-food-producing areas. Mechanism testing shows that land transfer impacts income inequality among farm households by promoting entrepreneurship. Farm households who use the Internet and have stronger social capital gain more from the impact of land transfer on income inequality.