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Does land titling improve credit access? Quasi-experimental evidence from rural China

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  • Longyao Zhang
  • Wenli Cheng
  • Enjiang Cheng
  • Bi Wu

Abstract

Based on official surveys conducted in 2010 and 2015, we study how the Chinese land titling reform beginning in 2009 affected rural households’ access to credit. We find that the reform had differential credit effects across households. For households with above-average economic status (measured by the area of cultivated land, level of income, and convenience of bank visits), access to formal credit improved as a result of the reform. For households with below-average economics status, reliance on informal credit lessened. We show that the availability of land as collateral might have enhanced access to formal credit. Another channel of the credit effects was income and wealth. We find that land titling had a positive impact on average household income, which would reduce their need for informal credit. For those households with above-average area of cultivated land, land titling increased their wealth and might have expanded their operations, which would increase both their credit demand and their ability to access formal credit.

Suggested Citation

  • Longyao Zhang & Wenli Cheng & Enjiang Cheng & Bi Wu, 2020. "Does land titling improve credit access? Quasi-experimental evidence from rural China," Applied Economics, Taylor & Francis Journals, vol. 52(2), pages 227-241, January.
    • Handle: RePEc:taf:applec:v:52:y:2020:i:2:p:227-241
    DOI: 10.1080/00036846.2019.1644446
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    Citations

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    Cited by:

    1. Hasanbasri, Ardina & Koolwal, Gayatri & Kilic, Talip & Moylan, Heather, 2021. "Multidimensionality of Land Ownership Among Men and Women in Sub-Saharan Africa," 2021 Conference, August 17-31, 2021, Virtual 315317, International Association of Agricultural Economists.
    2. Bu, Di & Liao, Yin, 2022. "Land property rights and rural enterprise growth: Evidence from land titling reform in China," Journal of Development Economics, Elsevier, vol. 157(C).
    3. Liu, Shouying & Ma, Sen & Yin, Lijuan & Zhu, Jiong, 2023. "Land titling, human capital misallocation, and agricultural productivity in China," Journal of Development Economics, Elsevier, vol. 165(C).
    4. Hu, Xinyan & Chen, Zhuo & Chen, Xiangpo & Liu, Ziyu, 2023. "The political trust impacts of land titling in China," Land Use Policy, Elsevier, vol. 129(C).
    5. Jiang Du & Miao Zeng & Zhengjuan Xie & Shikun Wang, 2019. "Power of Agricultural Credit in Farmland Abandonment: Evidence from Rural China," Land, MDPI, vol. 8(12), pages 1-14, December.
    6. Chepkirui Agnes & Dr. D. S Parsitau & Dr. Diana A. Opollo, 2024. "How Women’s Financial Exclusion is Affecting Gender Equity in Tea Farming in Singorwet Ward, Bomet County," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(3), pages 1969-1985, March.
    7. Juan Zhang & Qinping Chen & Hongxi Chen & Zehua Feng, 2023. "How Does Farmland Tenure Security Affect Rural Household Income? Empirical Evidence of China’s Survey Data," Sustainability, MDPI, vol. 15(7), pages 1-17, March.
    8. Zhou, Nan & Cheng, Wenli & Zhang, Longyao, 2022. "Land rights and investment incentives: Evidence from China’s Latest Rural Land Titling Program," Land Use Policy, Elsevier, vol. 117(C).
    9. Wenli Cheng & Nan Zhou & Longyao Zhang, 2021. "How does land titling affect credit demand, supply, access, and rationing: Evidence from China," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(3), pages 383-414, September.
    10. Liu, Kai & Zhu, Wenjue & Luo, Mingzhong, 2022. "Land integration and titling policy in China: Institutional barriers and countermeasures," Land Use Policy, Elsevier, vol. 112(C).
    11. Shewakena Aytenfisu Abab & Feyera Senbeta & Tamirat Tefera Negash, 2023. "The Effect of Policy and Technological Innovations of Land Tenure on Small Landholders’ Credit-Worthiness: Evidence from Ethiopia," Land, MDPI, vol. 12(5), pages 1-19, May.
    12. Xiang Deng & Min Zhang & Chunlin Wan, 2022. "The Impact of Rural Land Right on Farmers’ Income in Underdeveloped Areas: Evidence from Micro-Survey Data in Yunnan Province, China," Land, MDPI, vol. 11(10), pages 1-16, October.

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