The Effects Of Agricultural Land Transfer On Income Inequality Of Rural Households

In the process of moving toward the goal of building a powerful socialist modern country,achieving common prosperity requires focusing on addressing the problem of unbalanced and insufficient development.The large income gap within rural households is one of the main problems of rural poverty.As the most important production factor for farmers,agricultural land transfer has changed the rigid land distribution pattern and reshaped farmers’ livelihood model,which is another important initiative of China’s rural land system reform after the household contract responsibility system.In the current context,it is particularly important to examine what role agricultural land transfer can play in rural revitalization and whether it can improve income inequality within rural areas.This paper uses CHFS data.From the perspective of relative deprivation,the Kakwani relative deprivation index is used to measure the level of individual income inequality for each rural household.On this basis,OLS and two-stage control function(2SCF)methods are used to empirically investigate the effects of agricultural land transfer on income deprivation,i.e.,individual income inequality,and to examine whether there is heterogeneity in the effects of agricultural land transfer in and out on income deprivation of different types of rural households,and finally,to further explore the effects of agricultural land transfer in and out on farm income deprivation and non-farm income deprivation of rural households.The main findings of this paper show that(1)Agricultural land transfer can reduce income deprivation by about 0.103 units compared to rural households that do not transfer agricultural land.Among other variables,political capital,human capital,physical capital and social security all have a dampening effect on income deprivation of rural households.(2)Compared to the control group,transferring in agricultural land can reduce income deprivation by about 0.131 units,while transferring out agricultural land has no effect on income deprivation.These results remain robust to replacing the Kakwani relative deprivation index with the Yitzhaki relative deprivation index.(3)Transferring in agricultural land has a more pronounced dampening effect on income deprivation for households with pension insurance as well as higher levels of education.At the same time,tranfering in agricultural land can reduce the income deprivation of rural households in the Midwest.For households with different levels of pension insurance,different levels of education,or different regions,transferring out agricultural land has no effect on income deprivation.(4)Transferring in agricultural land reduces agricultural income deprivation,but has no effect on non-agricultural income deprivation.Transferring out agricultural land will increase farm income deprivation of rural households,while it will alleviate non-farm income deprivation.Based on the above findings,this paper puts forward the following policy recommendations:(1)Foster the rural land transfer market,improve the land transfer service system,and enhance the convenience of farmers in transferring their agricultural land.(2)Encourage rural households to actively transfer their land through effective technical and material assistance and guide agricultural land operators to expand their production scale.(3)Improve the social security system in rural areas,raise the education level of rural residents,so as to give full play to the income redistribution function of social security and human capital.(4)Strengthen the construction of labor market and raise the level of non-farm income after the transfer of rural labor to the urban sector.