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How Much Expropriation Hazard Is Too Much? The Effect of Land Reallocation on Organic Fertilizer Usage in Rural China

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  • Ying Bai
  • James Kung
  • Yang Zhao

Abstract

In China, land is reallocated on either a full-scale or a partial basis. By employing a unique farm survey that deliberately draws a distinction between full-scale and partial land reallocations, and by decomposing their respective expropriation risk effects, we find that the significantly negative effect of expropriation risk on organic fertilizer usage is driven solely by full-scale reallocation. Consistent with this finding, a reduction in the predicted expropriation hazard rate by half leads to a sizable increase of 491% in organic fertilizer usage in villages with a history of full-scale reallocation, and has an estimated productivity effect of 19.1%.

Suggested Citation

  • Ying Bai & James Kung & Yang Zhao, 2014. "How Much Expropriation Hazard Is Too Much? The Effect of Land Reallocation on Organic Fertilizer Usage in Rural China," Land Economics, University of Wisconsin Press, vol. 90(3), pages 434-457.
    • Handle: RePEc:uwp:landec:v:90:y:2014:iii:1:p:434-457
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    Cited by:

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    2. Xinjian Chen & Di Zeng & Ying Xu & Xiaojun Fan, 2018. "Perceptions, Risk Attitude and Organic Fertilizer Investment: Evidence from Rice and Banana Farmers in Guangxi, China," Sustainability, MDPI, vol. 10(10), pages 1-14, October.
    3. Leight, Jessica, 2016. "Reallocating wealth? Insecure property rights and agricultural investment in rural China," China Economic Review, Elsevier, vol. 40(C), pages 207-227.
    4. Jinhua Xie & Gangqiao Yang & Zhaoxia Guo & Ge Wang, 2021. "Exploring the Influence Mechanism of Farmers’ Organic Fertilizer Application Behaviors Based on the Normative Activation Theory," Land, MDPI, vol. 10(11), pages 1-18, October.
    5. Yang, Fanzheng & Hou, Lingling & Xia, Fang, 2024. "Intergenerational altruism, pessimism bias on tenure insecurity, and sustainable land use: Evidence from household grassland management in China," Ecological Economics, Elsevier, vol. 215(C).
    6. Li, Bowei & Shen, Yueqin, 2021. "Effects of land transfer quality on the application of organic fertilizer by large-scale farmers in China," Land Use Policy, Elsevier, vol. 100(C).
    7. 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).
    8. Bao, Helen X.H. & Jiang, Yan & Wang, Ziyou & Feng, Lei, 2024. "Social capital and the effectiveness of land use policies: Evidence from rural China," Land Use Policy, Elsevier, vol. 139(C).

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    More about this item

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment

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