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INVERSE RELATIONSHIP BETWEEN PRODUCTIVITY AND FARM SIZE: THE CASE OF CHINA
Author(s) -
CHEN ZHUO,
HUFFMAN WALLACE E.,
ROZELLE SCOTT
Publication year - 2011
Publication title -
contemporary economic policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.454
H-Index - 49
eISSN - 1465-7287
pISSN - 1074-3529
DOI - 10.1111/j.1465-7287.2010.00236.x
Subject(s) - china , productivity , inverse , econometrics , agriculture , economics , agricultural economics , quality (philosophy) , geography , mathematics , economic growth , geometry , archaeology , philosophy , epistemology
In developing agricultures, past research has suggested an inverse relationship between farm productivity and size. The raw data from China show such an inverse relationship. However, the inverse relationship disappears after we instrument for land area using the fact that one of the objectives of the land allocation process in rural China is to ensure local households to meet their nutritional needs. The empirical inverse relationship is likely due to the failure to account for the unobserved land quality that is unevenly distributed across the farm size continuum, rather than inherent to China's agriculture . ( JEL O13, Q12, Q15)