Resource information
Even though it is widely recognized that
giving farmers more secure land rights may increase
agricultural investment, scholars contend that, in the case
of China, such a policy might undermine the function of land
as a social safety net and, as a consequence, not be
sustainable or command broad support. Data from three
provinces, one of which had adopted a policy to increase
security of tenure in advance of the others, suggest that
greater tenure security, especially if combined with
transferability of land, had a positive impact on
agricultural investment and, within the time frame
considered, led neither to an increase in inequality of land
distribution nor a reduction in households' ability to
cope with exogenous shocks. Household support for more
secure property rights is increased by their access to other
insurance mechanisms, suggesting some role of land as a
safety net. At the same time, past exposure to this type of
land right has a much larger impact quantitatively,
suggesting that a large part of the resistance to changed
property rights arrangements disappears as household
familiarity with such rights increases.
