Abstract
This paper investigates China’s agricultural households and their individual members’ off-farm labor supply decision in response to farm production risks and a number of other factors (e.g., demographic characteristics, farm characteristics, and local market features). Whether and to what extent farming risks may affect farmers’ off-farm employment in China are rarely studied. Our paper provides an empirical study to demonstrate that agricultural production risks significantly impact off-farm labor supply in rural China. The impacts of associated variables on households off-farm labor supply decisions are quantified using a sample of large–scale nationwide household finance survey in 2010. The results suggest that off-farm employment serves as a risk adaption strategy for Chinese farmers. Policy suggestions on retaining farmers to focus on agricultural production are discussed.
Highlights
The economic reforms of China that started nearly four decades ago has led to dramatic changes in the economic landscape of the nation
We focus on the following research questions: (1) How shall a China’s farm household decide whether they would like to take off-farm jobs? (2) What are the driving forces of such a decision? (3) For a Chinese rural household, does such a labor supply decision respond to agricultural production risks? (4) Does this labor allocation decision differ across the regions? The overall goal of this paper is to contribute to the assessment of agricultural households decision–making on labor allocation in China
This paper fills the gap in the existing literature that, when evaluating rural households off-farm labor supply in China, agricultural production risks have never been considered
Summary
The economic reforms of China that started nearly four decades ago has led to dramatic changes in the economic landscape of the nation. This paper fills the gap in the existing literature that, when evaluating rural households off-farm labor supply in China, agricultural production risks have never been considered. We need to use individual level data in our sample Among these 2352 farm households, the individual household members are classified into five categories: (1) pure farmers (a.k.a. full-time farmers) who only engaged in farming activities; (2) farmers who primarily engaged in the farming work and had some off-farm income source (a.k.a. part-time farmers); (3) non-farmers who exclusively worked outside the farm; (4) dependents who were under 16 years old Male Marital status Average age Average education Farmland size per capita (acre) N
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