Effects Of Farmland Transfer On Land Fragmentation And Agricultural Production

In recent years, with the rapid economic growth, the speed and scale of the farmland transfer continue to rise. Land transfer has three possible effects, namely, the economy of scale, gains from trade and the equalization of marginal productivity of land across households. Farmland transfer is therefore an efficient way to solve land fragmentation and land abandonment, and plays an very important role in optimizing of land resource allocation, improving land use efficiency, promoting agricultural structural adjustment, increasing farm household income and stimulating rural economic development.Based on the micro-level household survey data from three districts in Nanjing (Luhe District, Jiangning District, Lishui County) in 2006, this thesis described farm households' participation in farmland transfer and off-farm employment in the three districts/counties, examined the effects of the economy of scale and the equalization of marginal productivity of land generated by farmland transfer. The main contents include:The first main part of the thesis described the characteristics of the sample area and analyzed the current situation in Luhe District, Jiangning District and Lishui County about households'participation in farmland transfer, rent payment, contract, intermediary organization and insurance. In the three districts/counties, most of the households rent out irrigated land.The second main part of the thesis applied the Probit model to analyze the determinants of households'participation in farmland transfer. Results indicate that households with less agricultural assets and more non-agricultural assets are more likely to rent out their land. Farmlands are transferred from larger households to smaller households. Households with off-farm employment experience have high possibility in renting out their farmlands. The results for land renting in are not significant.The third main part of the thesis applied the Tobit model and OLS method to examine the effects of farmland transfer on land fragmentation. Results indicate that the degree of land fragmentation before farmland transfer significantly affects that after farmland transfer. Households that rented out their farmland have a lower degree of land fragmentation. Land renting out activity can therefore reduce land fragmentation and increase farm size.The fourth main part of the thesis used the OLS method to explore the direct and indirect effects of farmland transfer on agricultural productivity, namely the equalization of marginal productivity of land across households and the economy of scale. Results indicate that farmland transfer stimulates the land to be transferred from less productive households to those with higher productivity. Farmland transfer can also promote scale management by reducing land fragmentation, and improve crop yield. But this effect is not significant.Finally, based on the above results, this thesis proposed the policy implications for the further development of farmland transfer:(1) establish farmland transfer market, actively optimize land resources allocation, promote scale management and increase agricultural productivity; (2) develop secondary and tertiary industries to provide farmers with more off-farm employment opportunities and promote farmland transfer; (3) change the focus of farmland property rights reform, promote the implementation of farmland property rights system at the village and households level, and improve the security of households' farmland property rights.