Rural land rental markets in developing countries: Can survey design innovations improve land market participation statistics?

PurposeThis study aims to investigate whether the participation in land rental markets helps to mitigate impacts by climate change on multidimensional poverty in Thailand and Vietnam.Design/methodology/approachThe authors use precipitation data from the National Aeronautics and Space Administration (NASA) and self-reported shocks from the Thailand Vietnam Socio-Economic Panel (TVSEP) project to estimate climate change. Data from the TVSEP are also used to calculate a multidimensional poverty index (MPI). Fixed-effect logit panel regressions with interaction terms are implemented to analyze the above mentioned.FindingsThe results show that land rental markets are used as mitigation strategies to climate change in Thailand and Vietnam. The participation in land rental markets also reduces multidimensional poverty. However, as a mitigation strategy, land rental markets are only successful in certain circumstances.Research limitations/implicationsThe results show that there is potential in using land rental markets as mitigation strategies to climate change. Further research is needed to better understand which adaptation strategies, besides land rental market participation, and which combinations of different adaptation strategies are successful to mitigate negative effects induced by climate change.Practical implicationsThe results show that there is potential in using land rental markets as mitigation strategies to climate change. Therefore, education in the participation in land rental markets and how to use them as a mitigation strategy can be a way to increase households' resilience to negative effects induced by climate change. Households make better decisions regarding their land when they are better informed on the functionality of land rental markets. Additionally, being better informed increases self-confidence to participate in land-rental markets.Originality/valueLand rental markets as a mitigation strategy to climate change rarely have been studied, and if so, mainly the effect of leasing land has been studied. Additionally, the authors implement new measures of poverty – a multidimensional view on poverty which provides new insights into who are the poor and how they can be lift out of poverty.

We use nationally representative household‐level panel survey data in two neighboring countries in Southern Africa—Zambia and Malawi—to characterize the current status of rural land rental market participation by smallholder farmers, and their subsequent welfare impacts. Rural rental market participation is much higher in densely‐populated Malawi than in lower‐density Zambia, reflecting the role of land scarcity in driving rental market development. Consistent with previous literature, we find evidence that rental markets contribute to efficiency gains within the smallholder sector by facilitating the transfer of land from less‐able to more‐able producers, on average, in both countries. Furthermore, we find that rental markets serve to re‐allocate land from relatively land‐rich to land‐poor households. We examine the impacts of participation on a number of welfare outcomes and find evidence for generally positive returns to renting in land in both countries, on average. However, our analysis also indicates that the returns to renting in land vary strongly with scale of production: tenants who produce more have larger returns to renting in, and many of the smaller producers who rent in do so at an economic loss. The impacts of renting out (i.e., participating in markets as landlords) are decidedly more mixed, with overall negative returns to landlords in Malawi and negligible returns to landlords in Zambia. The findings in this article highlight the need for researchers and policymakers in sub‐Saharan Africa to stay attuned to how land rental market participation and its impacts evolve in the near future.

The study used a sample size of 386 small-scale farmers to jointly determine the drivers of small-scale farmers’ rental market participation in Kenya. The results of a bivariate probit model show that renting in participants were young, more educated and owned relatively small farms while renting out participants were relatively old, less educated and owned large pieces of land. Transaction costs, access to extension services and ownership to oxen were the main determinants of land rental market participation. To heighten land equalization, policies that enhance reinvestment in agricultural assets, access to extension services and reduce transaction cost are important.

We assess the extent of access and degree of participation by smallholder tenants in the land rental market in Malawi. Our study is based on three rounds of nationally representative Living Standards Measurement Surveys collected in 2010, 2013 and 2016, from which we construct a balanced panel. We apply the transaction cost theory, which suggests transaction costs to be non-linear and depend on resource as well as socioeconomic characteristics within the customary tenure system that determines who hold, use and transfer land. Controlling for unobserved heterogeneity, the dynamic random effects probit and Tobit models show that transaction costs in the rental market (on the tenant side) are non-linear, high and lead to state dependency in the market. This implies that past land rental experience, social capital and networks, trust and reputation significantly reduce transaction costs and facilitate entry and extent of participation in the rental market. The results point towards the need for land tenure reforms that can reduce these high transaction costs. Access to information through social network could be one way that can improve land access for land-poor and potential tenants, thereby enhancing both equity and efficiency effects of land rental markets.

This research is attempted to understand drivers of household decision to participate in landrent-out market. Using data from 88 farm households surveyed in 2009 the paper tested for factors that affect the degree and extent of households’ participation in the rural land rentalmarket. Result of the Tobit model revealed that landholding size, and age of the household heads are important variables which had positive and significant influence on participation and intensity of participation in land renting-out market. The result further explained that less oxen ownership and older households are more likely in renting-out their land. This implying that rental market helps to facilitates adjustments in farm size in order to meet emerging current needs of young households and enabling smooth replacement of older generations. The analyses figured-out that the liquidity of land renting-out market is hampered by insecurity of tenure in arranged rental land market. The twin effects of land tenure insecurity and poor infrastructure development cause farms to operate below optimal level. Therefore, it would thus be desirablefor the government to improve the regulatory framework for the land rental market to operate efficiently; and development interventions should give emphasis to strengthening infrastructural development so as to enhance well functioning dynamic land rental markets in the district. Key words: Land rent-out, tenure security, drivers to land markets

Purpose Economic reforms in rural China have led to the emergence of land and labor markets. The development of rural land rental markets can improve agricultural productivity and equity by facilitating transfers of land to more productive farmers and facilitating the participation in the non-farm economy of less productive farmers. In contrast to the burgeoning development of off-farm labor markets, the development of rural land rental market has lagged. The purpose of this study is to analyze the factors affecting households’ entry and transaction intensity in rural land rental markets, especially the effects of land tenure and off-farm employment. Design/methodology/approach Based on a field survey data of 479 household in Henan Province in 2009, the authors used Cragg’s double hurdle model to identify the determinants for households’ land rental participation and its transaction amount. Findings Off-farm employment is one of main driving factor for household’s land rent-out decision. Tenure insecurity reduces both the propensity and the magnitude of rental market transactions. Land use certificates significantly contribute to participation in land-rental markets and the rental amount. Originality/value This paper treats household land rental market participation as a related two-step process, focusing on both land transfer and its transaction amount. This paper also builds on a broad view, including analysis on both demand and supply side of land rental market.

Smallholder participation in the land rental market in a mountainous region of Southern China: Impact of population aging, land tenure security and ethnicity

We examine the effects of natural disaster exposure on agricultural households who simultaneously make rent-in and rent-out decisions in the land rental market. Our econometric approach accounts for the effects of disaster exposure both on the adjustments in the quantity of operated land (i.e. extensive margin) and agricultural yield conditional on the land quantity adjustments (i.e. intensive margin), based on selectivity-corrected samples of rental market participants. Employing a household survey dataset from Bangladesh, we find that farmers were able to ameliorate their losses from exposure to disasters by optimizing their operational farm size through participation in the land rental market. These results are robust to alternative specifications. This suggests that the land rental market may be an effective instrument reducing disaster risk, and post-disaster policies should take into account this role more systematically.

This article uses nationally representative panel survey data from Malawi and Zambia to estimate the factors affecting a smallholder farm household’s decision to participate in land rental markets as either a tenant or a landlord. We also estimate how land rental market participation influences various measures of household income and welfare. We find that land rental markets in both Malawi and Zambia promote efficiency by transferring land from less able to more able farmers. Land rental markets in Malawi promote equity by transferring land relatively labor-poor to labor-rich households, and in both countries we find evidence that land markets transfer land from land-rich to land-poor households. In both countries, we find evidence that renting in land has a positive effect on household income and reduces the probability of the household being in poverty. However, when we consider the full cost of renting in land, the positive impacts are much lower.

Participation in land rental and labor markets and agricultural economic performance of banana farmers in China

Agricultural land mobility through an efficient land rental market has been shown to contribute to the productive and sustainable utilisation of land, by facilitating the transfer of land from less productive farmers to more productive farmers. However, this is not the case in Northern Ireland where the sale of agricultural land is limited with a constrained tenanted sector. The objective of this study is to analyse the factors influencing participation in the land rental market in Northern Ireland. To achieve our objective, data from 1466 farmland owners was analysed using principal component analysis (PCA) and multinomial logistic regression model. The results show that land rental market participation is impacted by motivational and socioeconomic factors. The study recommends the development of schemes that support the early and comfortable retirement of older farmers to increase the access of young farmers to land and improve the land rental market.

China's rural economic reforms radically altered land tenure in rural China. With the granting of land use rights and residual income rights to farming households between 1979 and 1983, agriculture shifted from a collective-based to a familybased system. Land was not privatized, however. Ownership remained "collective", with local officials, typically at the village level, exercising a major influence over the allocation of land and the way households could use land. The initial land allocations to families were typically based on household size, household labour supply, or both. The central government's policy was that these allocations were supposed to be for 15 years. In some villages, land use contracts have been respected; in other villages, however, local leaders have periodically redistributed land among households and have intervened throughout the reform period to determine how farmers are able to use the land. The initial reforms triggered an unprecedented acceleration of agricultural growth in China. From 1979 to 1984, the gross value of agricultural output increased in real terms at an annual rate of 7.6 per cent, and grain production rose by 4.9 per cent annually.' Empirical studies attribute a significant part of this increase to enhanced incentives, as farmers were able to keep the output and

The establishment of secured and easily transferable land use rights is a key component of rural development and poverty reduction pathways in many underdeveloped countries. In this study, we use balanced panel data collected from 407 farm households between 2009/10 and 2014/15 production seasons and apply difference‐in‐difference approach to examine impact of second‐stage land certification on tenure security, participation and extent of participation in the land rental market. Our finding shows that second‐stage land certification has helped to boost tenure security of smallholder farmers. However, the differences in difference results show that the second stage land certification has not yet started to influence farm households’ participation in the land rental market. This could probably be due to the fact that the program is at its early stage of implementation and may warrant further scrutiny with additional time.

The purpose of this study is to assess the impact of participation in the land rental market on smallholder farmers’ commercialization using farm household panel data in Tigrai, Ethiopia. Regression results reveal that 1 hectare increase in area rented in by tenant households leads to a 60% increase in the likelihood of participation in the output market as a crop seller and increases the marketed output sold by tenant households by US$ 200/year. The results appear to indicate that land rental market in the land scarcity economy to some extent contributes positively in the facilitation of transformation toward smallholders’ commercialization.

This study uses panel data from 1,142 Kenya smallholder households over four survey periods to examine the determinants of participation in land rental markets and to quantify the impact of renting land on households' income and poverty status. Overall, the study finds that land rental markets in Kenya promote farm productivity and significantly raise the incomes of land-constrained farm households. However, these percentage increases in the incomes of renters are often not large in absolute terms, and hence participation in rental markets alone is not sufficient to meaningfully affect rural poverty rates.