The impact of farmland fragmentation in China on agricultural productivity

Abstract

Existing studies have primarily examined the impact of farmland fragmentation on agricultural production from the perspective of crop yield per unit of land. However, they generally overlook the effects of farmland fragmentation on the productivity of both labor and capital. Drawing upon micro-level data from rice, wheat, and maize farmers across 14 provinces in China for the years 2019 and 2020, this paper measures the effects of farmland fragmentation on the labor productivity, land productivity, and capital productivity of these three different crops, within the same temporal and spatial dimensions. We utilize the internal instrumental variable method (KV-IV) to address potential endogeneity issues in the model. The research findings indicate: (1) Farmland fragmentation hampers the use of machinery, resulting in a significant decrease in the labor productivity of farmers. On average, for every 1% increase in the level of farmland fragmentation, labor productivity for rice, wheat, and maize farmers drops by 21.3%, 19.9%, and 21.9% respectively. (2) Farmland fragmentation has significantly increased the land productivity of rice. With every 1% increase in farmland fragmentation, the land productivity of rice farmers increases on average by 3.4%. However, the impact of farmland fragmentation on the land productivity of wheat and maize is not significant. (3) The capital productivity of rice, influenced by farmland fragmentation, mirrors the changes seen in land productivity. Rice farmers with higher levels of farmland fragmentation exhibit greater capital productivity. On average, with every 1% increase in the level of farmland fragmentation, the capital productivity of rice farmers increases by 6.7%. Conversely, farmland fragmentation has a significant negative impact on the capital productivity of both wheat and maize farmers. On average, for every 1% increase in farmland fragmentation, the capital productivity of wheat and maize farmers drops by 9.1% and 7.0% respectively. Based on the empirical results of this paper, we propose corresponding policy recommendations. In the conclusion, we delve into the underlying causes of farmland fragmentation in China and ascertain that, to address the issue of farmland fragmentation in the country, the government must take a leading role. The significance of this paper lies in analyzing the varying degrees and directions of the impact of farmland fragmentation on different crops, providing a basis for the government to implement differentiated farmland fragmentation management policies in different crop-producing regions in the future.