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The Impact of Plot Size on Productivity Growth: Evidence from Southeastern China

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  • Li, Xiangyu
  • Sato, Takeshi
  • Kawasaki, Kentaro
  • Suzuki, Nobuhiro

Abstract

The objective of this study is to estimate the impact of plot size on productivity growth. Accordingly, we measured the size of nearly 4,000 plots using satellite images and merged them with city-level agricultural statistics for southeastern China. The main findings are as follows. First, the results show that plot size is inversely correlated with land productivity growth. The results showed that a 10% decrease in plot size would accelerate the annual growth rate by 0.10 percentage points. Second, to clarify the mechanism behind the inverse relationship, the study shows that small-plot farmers are more willing to shift their crop types to high-value crops than large-plot farmers.

Suggested Citation

  • Li, Xiangyu & Sato, Takeshi & Kawasaki, Kentaro & Suzuki, Nobuhiro, 2024. "The Impact of Plot Size on Productivity Growth: Evidence from Southeastern China," Japanese Journal of Agricultural Economics (formerly Japanese Journal of Rural Economics), Agricultural Economics Society of Japan (AESJ), vol. 26.
    • Handle: RePEc:ags:jpjjre:348929
    DOI: 10.22004/ag.econ.348929
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    References listed on IDEAS

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    1. Juliano J. Assunção & Luis H. B. Braido, 2007. "Testing Household-Specific Explanations for the Inverse Productivity Relationship," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 89(4), pages 980-990.
    2. Assunção, Juliano & Braido, Luis H.B., 2007. "AJAE Appendix: Testing Household-Specific Explanations for the Inverse Productivity Relationship," American Journal of Agricultural Economics APPENDICES, Agricultural and Applied Economics Association, vol. 89(4), pages 1-8, November.
    3. Emily Oster, 2019. "Unobservable Selection and Coefficient Stability: Theory and Evidence," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 37(2), pages 187-204, April.
    4. Carletto, Calogero & Savastano, Sara & Zezza, Alberto, 2013. "Fact or artifact: The impact of measurement errors on the farm size–productivity relationship," Journal of Development Economics, Elsevier, vol. 103(C), pages 254-261.
    5. Bevis, Leah EM. & Barrett, Christopher B., 2020. "Close to the edge: High productivity at plot peripheries and the inverse size-productivity relationship," Journal of Development Economics, Elsevier, vol. 143(C).
    6. Lamb, Russell L., 2003. "Inverse productivity: land quality, labor markets, and measurement error," Journal of Development Economics, Elsevier, vol. 71(1), pages 71-95, June.
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