Rural households' decisions towards income diversification: Evidence from a township in northern China

Economic reforms in rural China have brought opportunities to diversify both within-farm activities and off-farm activities. Participation in these activities plays an important role in increasing rural households' income. This paper analyzes the factors that drive rural households and individuals in their income-source diversification choices in a Northern China township. At the household level, we distinguish three types of diversification as opposed to grain production only: within-farm (non-grain production) activities, local off-farm activities, and migration. We find that land availability stimulates on-farm diversification. Local off-farm activities are mostly driven by households' asset positions and working resources, while migration decisions strongly depend on the household size and composition. At the individual level, we analyze the determinants of participation in three different types of jobs as compared to agricultural work: local off-farm employment, local self-employment and migration. We find a clear gender and age bias in access to off-farm activities that are mostly undertaken by male and by young people. The households' asset positions as well as village networks are found to strongly affect participation in off-farm activities.     

Self-employment of Chinese rural labor force: Subsistence or opportunity?—An empirical study based on nationally representative micro-survey data

Self-employment is an essential form of non-agricultural employment, and its nature has been rarely identified in recent studies. From the perspectives of the human capital, social capital, and family assets of rural laborers, this study focuses on determining self-employment by using the nationally representative data on the rural labor force in China. Through the static comparative analysis between three groups of laborers in self-employment, wage employment, farming, and the dynamic comparative analysis of laborers entering into and exiting from self-employment, the study shows that self-employment of rural laborers in China is almost opportunity-driven or moving toward opportunistic self-employment. Human capital, social capital, and family assets promote rural laborers shifting from wage employment to self-employment and stimulate the establishment of high-value enterprises. The study suggests that local governments should increase the investments in rural education and vocational skills training and strengthen the availability of rural credit to lay a good foundation for self-employment activities in rural areas.     

Does off-farm employment contribute to agriculture-based environmental pollution? New insights from a village-level analysis in Jiangxi Province, China

This study examines the conventional wisdom that off-farm employment contributes to environmental pollution by increasing the use of agro-chemicals. In order to analyse the role of household decision making and village factor markets in more detail, we run simulations with a hybrid farm household/village computable general equilibrium model that is applied to a village in Northeast Jiangxi Province. We find that the negative lost-labour effect of off-farm employment on agricultural incomes is much stronger than the (small) positive income effect. As a result of reduced labour resources and increased leisure consumption, farm households reduce the intensity of rice cultivation as well as the production of (especially) cash crops. The shift in production activities is stronger for migration than for off-farm employment, because migrants cannot combine off-farm work with onfarm work, and because migration reduces the village market price of oxen services. The shift towards less intensive rice production means that off-farm employment (and migration in particular) reduces the levels of chemical inputs and manure used in agricultural production. The decline in fertilizer input is much larger than the decline in manure use, because manure is a nontradable commodity and is applied only once per year. We therefore conclude that migration and, to a lesser extent, local off-farm employment lead to lower incomes from agricultural production, but have benign effects on environmental quality.     

Nonfarm Employment and Poverty Alleviation of Rural Farm Households in Honduras

This paper analyzes the role of nonfarm income of rural farm households in Honduras. It uses the national income and expenditure survey from 1993 to 1994. Income from nonfarm wage and self-employment represents 16–25% of farm household income and is especially important for middle and higher income strata. Nonfarm wage labor is geographically concentrated in small rural towns and in the industrial free zones located in the Northern region, while self-employment is particularly developed in the Southern region. Access to nonfarm wage employment is confined to educated individuals that belong to large households, while female members of wealthier households are mainly involved in self-employment. Food security is strongly enhanced through the engagement in nonfarm activities. Moreover, nonfarm income enables farmers to purchase external inputs for improving yields and labor productivity. Suitable policies to enhance nonfarm employment include education, training, and technical assistance to reduce labor intensity in agricultural production, as well as public investment and credit services to improve access to nonfarm activities.     

农村劳动力回流、就业选择与农地转出——基于千村调查的经验研究

农村劳动力回流趋势增强，不可避免对农地流转产生影响。文章在理论层面深入剖析了回流劳动力的就业选择与农地转出关系，并采用上海财经大学"千村调查"的数据资料，实证检验了农村劳动力回流特征变化和回流劳动力就业选择对农地转出的影响。研究发现，受非农就业不稳定的推力作用和与家人团聚的拉力作用，越来越多的外出劳动力选择回流，西部外出劳动力回流率最高，达到47.2%。回流劳动力的农地转出率普遍高于非回流劳动力的农地转出率，回流劳动力从事非农生产的就业选择对农地转出存在促进效应，而兼业和务农的选择对农地转出存在抑制效应，这意味着回流农村劳动力并非一定会选择农业生产，也可能选择在更小的地理半径内从事非农就业，并且长期外出从事技术工的经历进一步增强了劳动力回流对农地转出的抑制效应。虽然回流劳动力更倾向非农就业，但回流劳动力规模的扩大，使得兼业和纯务农的比例增加，对农地转出的抑制效应呈增强趋势。研究还发现，个人特征、家庭因素、社会网络也是影响劳动力就业选择和农地转出的重要因素，基层政府和地方政府在推动非农就业的政策合力上存在部分抵消，对农地转出产生了抑制作用。文章为农地流转进程缓慢提供了新的解释，推进农地流转需要关注农村劳动力流动特征新变化，同时兼顾各层级政策目标的衔接性。     

The role of off-farm employment in the rural energy consumption transition — A village-level analysis in Jiangxi Province, China

Energy consumption in rural areas in China is characterized by high consumption of fuelwood, straw and other biomass. Off-farm employment can play an important role in the transition towards more sustainable sources of energy by increasing rural household incomes and reducing the amount of labor available for biomass collection. The purpose of this paper is to examine the impact of off-farm employment on rural household energy consumption choices, and to disentangle the various causal relationships that play a role in this respect. To this end, a hybrid farm household/village computable general equilibrium (CGE) model is used that has been calibrated for a remote village in Northeast Jiangxi Province where fuelwood is the main source of energy. The model takes into account nonseparability of farm household production and consumption decisions as well as linkages within the village between households involved in off-farm employment and households with no members working off-farm. Contrary to previous research for a richer region in rural China, we find that fuelwood is not an inferior good. The positive impact of more food consumption on fuelwood collection more than compensates the higher leisure demand associated with higher incomes. Shifts in production activities and in prices on village factor markets caused by increased labour scarcity (the lost-labour effect of off-farm employment), on the other hand, cause a reduction in fuelwood collection and consumption. This lost-labour effect is much stronger for migration than for local off-farm employment, because the latter can more easily be combined with on-farm work and fuelwood collection. For local off-farm employment the income effect dominates the lost-labour effect, resulting in a positive overall impact of higher off-farm participation on fuelwood consumption. For migration, on the other hand, the income effect and the lost-labour effect are almost equal in size. Hence, the amount of fuelwood collected and consumed does not change much when households participate in migration. The final conclusion is therefore that increased off-farm employment opportunities do not promote the transition of rural energy use in the poorer regions of rural China.     

The Determinants of Nonfarm Income Diversification in Rural Peru

This paper shows that in Peruvian rural areas, there has been substantial growth over the past decade in household employment outside of own-farming. At present 51% of the net income of rural households comes from these off-farm activities, and thus they certainly cannot be considered as “marginal.” The reasons households diversify their incomes are several. Access to public assets such as roads and private assets such as education and credit is an important factor in diversification. Increasing access to these assets will help rural households to increase their self-employment as well as wage employment in the nonfarm sector.     

Determinants of Household Income Mobility in Rural China

This article uses multivariate regression and decomposition analyses to assess household income mobility determinants and their contributions to income mobility in rural China from 1989 to 2006. The findings indicate that households with lower initial income level, higher share of wage income, higher educational level of household members, larger number of non-agricultural employed household members and younger heads are more mobile. Moreover, besides initial income, change in the share of wage income, change in the share of non-agricultural employed household members, and change in average year of education of household members are the most important factors that account for income mobility. These findings necessitate more emphasis on policies that promote non-agricultural employment and education to enhance household income mobility in rural China.     

Off-farm employment and grain production change: New evidence from China

How does off-farm employment affect grain production? Previous research findings are inconsistent. This paper provides a general theoretical framework to explain the effect of off-farm employment on grain production and consider that the effect is non-liner. The empirical results show that off-farm employment decreases grain production and insignificantly changes grain crop structure. Importantly, we find an inverted-U correlation between off-farm employment and grain production, meaning that off-farm employment will increase grain production when the off-farm labor supply is relatively low and will decrease grain production when the off-farm labor supply is relatively high. Further, we investigate the heterogeneity of the causal effect in the destinations of off-farm employment, household's land scale, land features, household location, and household aging.     

Land rental market, off-farm employment and agricultural production in Southeast China: A plot-level case study

This paper performs a plot-level analysis of the impact of land rental market participation and off-farm employment on land investment, input use, and rice yields for 215 plots cultivated by 52 households in three villages in Northeast Jiangxi Province. Our findings show that households that rent extra land are relatively more productive, but contradict results of earlier studies which found that tenure status of plots affects the level of land investments. We further find that off-farm employment does not significantly affect rice yields. This result contradicts those of earlier studies which found that the negative lost-labor effect of off-farm employment dominates the positive income effect. Another novel finding is that people working locally off-farm tend to switch from green manure planting towards the use of organic manure on their rice plots. We conclude that policies that will further stimulate the development of land rental markets, which is still in its infancy, can contribute significantly to higher rice production in Southeast China. Another implication of our results is that worries about the negative impact that the continuously growing off-farm employment may have on China's goal to remain self-sufficient in grain production are less relevant at the moment for the region examined in our study.     

Rural Nonfarm Employment and Incomes in Latin America: Overview and Policy Implications

Rural nonfarm employment (RNFE) and incomes (RNFI) are crucial to Latin American rural households. The 11 rural household income studies in this volume, reviewed in this paper, use 1990s data and show that RNFI averages 40% of rural incomes. RNFI and RNFE have grown quickly over the past three decades. The review of evidence provided some surprising departures from traditional images of nonfarm activities of Latin American rural households. In terms of shares of rural incomes: (1) nonfarm wage incomes exceed self-employment incomes; (2) RNFI far exceeds farm wage incomes; (3) local RNFI far exceeds migration incomes; (4) Service-sector RNFI far exceeds manufactures RNFI. These findings suggest the need for more development program attention to wage employment in the service sector, versus the traditional focus on small enterprise manufactures. Moreover, poor households and zones tend to have higher shares in their incomes but lower absolute levels of RNFI as compared to richer households and zones. The RNFE of the poor tend to be the low-paid nonfarm equivalent of semi-subsistence farming. Raising the capacity of the poor to participate in the better-paid types of RNFE is crucial — via employment skills training, education, infrastructure, credit. Finally, RNFE has grown fastest and been most poverty-alleviating where there are dynamic growth motors, in particular in the agricultural sector, but also in tourism, links to urban areas, mining and forestry. This means that developing RNF jobs cannot be done at the expense of programs promoting agricultural development.     

农民收入变动及影响因素的定量分析

文章通过考察20世纪90年代以来农民收入的变动情况,分析农民收入结构的变化。利用动态计量模型协整方法,得出影响农民家庭经营收入与工资性收入的主要影响因素和影响程度。即农产品生产价格和农村固定资产投资对农民家庭经营收入有很大的正效应;非农劳动力的比重对农民工资性收入具有很大的正效应,在提高农民收入上主要应从以上三方面入手。     

Gender Discrimination and Worker Selectivity: A Comparison of the Self-employed and Wage Earners

This study compares the size and nature of the gender earnings differentials for the self-employed and wage earners in Korea, taking into account the workers’ self-selection of each employment type. The two-stage estimates of the earnings equation, corrected for worker selectivity, are used to decompose the gender earnings differentials into productivity-related and discriminatory factors. Our results suggest that the size of the gender earnings gap is larger in the wage sector than in the self-employment sector, but not by large margin, and so is the discrimination effect when not controlled for worker selectivity. With worker selectivity controlled, the discrimination effect is greatly intensified in the wage sector, while it becomes not significant in the self-employment sector. These findings imply that the observed gender earnings gap in the wage sector is largely ascribed to discrimination against women, while the gender earnings gap in the self-employment sector is mostly due to productivity difference that, in part, is caused by worker selectivity.     

缩小数字鸿沟对退休再就业是否有帮助

本文使用CHARLS 数据构建了Logit 模型，以数字鸿沟为核心解释变量，结合个人特征、社会保障和对外经济支持等方面分析了数字鸿沟对退休再就业的影响。研究发现，其中老年数字鸿沟能够减少退休后的受雇就业，导致更多的退休人口选择不就业，但是对退休后是否自雇就业没有影响。综合而言，缩小老年数字鸿沟对退休再就业有显著的积极作用。此外，男性退休后更倾向于受雇就业，女性通常更需要照顾家庭。年龄对退休后受雇就业和自主经营具有负向影响，且影响程度相当。健康状况和社交活动参与对退休再就业也有显著影响。基于研究结果，本文提出相应的对策建议。     

Why do migrant households consume so little?

Exploring data from the migrant and urban household surveys of the Chinese Household Income Project, this paper dissects the underlying causes of the depressing effect of the hukou system on migrant household consumption to two channels. On one hand, migrants' disentitlement to local urban hukou creates financial insecurity through barriers to employment, social welfare, medical insurance, etc., thereby encouraging precautionary saving. On the other hand, it promotes temporary migration, allows divergence in tastes and values from local urban residents to persist, and incentivizes migrant households to save their transitory income. Factors reflecting these two channels, such as medical and pension insurances, the duration of migration, and local homeownership, are specifically modeled, and they are found to contribute to the discrepancies in consumption between migrant and local urban households, among other factors. In addition, the marginal propensity to consume exhibits heterogeneity across migrant households; it is higher with a longer duration of migration, local homeownership, and self-employment. The lack of these attributes further reinforces the reluctance of migrant households to consume.     

Labor market developments in China: A neoclassical view

This paper assesses the applicability of two alternative theories in understanding labor market developments in China: the classical view featuring a Lewis turning point in wage growth versus a neoclassical framework emphasizing rational choices of individuals and equilibrating forces of the market. Empirical evidence based on multiple data sources fails to validate the arrival of the Lewis turning point in China, showing continuous and coordinated wage growth across rural and urban sectors instead. Consistent with the neoclassical view, we find that rural workers expanded off-farm work when mobility restrictions were lifted, interprovincial migration responded to expected earnings and local employment conditions, and returns to education converged gradually to the international standard. These findings suggest major progresses in the integration of labor markets in China.     

Farm Household Responses to Government Policies: Evidence from West Java

Few micro level analyses have been undertaken in Indonesia of rural households' responses to government policies, and of household characteristics and endowments. Most studies of rural household behaviour in Indonesia have analysed the consumption, production and labour supply aspects separately, ignoring the complex interrelations among farm production, farm profit, household consumption and family labour supply. In this study, the complex nature of rural household production and consumption decisions is analysed by applying a farm household model to cross-sectional data from 241 households in six villages of West Java. The model incorporates multiple crops, different wage levels for males and females, and non-agricultural employment.     

Does Hukou pay? Evidence from nanny markets in urban China

This paper quantifies the effect of the Chinese Hukou (household registration) on expected wage of nannies in urban China. Using a novel data set with detailed individual information of nannies from 12 Chinese cities during 2015–2016, this study finds that a 1% increase in Hukou Index, a measure of inter-regional migration restrictions, leads to a 0.05% increase in expected wage of nannies. The effect is heterogeneous for sub-categories of Hukou policies and among different types of nannies. Migration networks also play a significant role, and the effects are different for migration networks of different sizes. These findings reveal the unexpected consequences of China’s tight control of internal migration and the change in wages of a relatively low-skill service sector.     

Returns to military service in off-farm wage employment: Evidence from rural China

This paper studies the returns to military service in off-farm wage employment and the implications of military service on the rural-urban transition in rural China. We exploit government-induced variations in aggregate enrollment rates as our instrumental variable. Using data from the China Family Panel Studies, we find a substantial positive effect of military service on off-farm wage employment and earnings for men of rural origin, which is comparable in magnitude to the estimated returns to a college education in China. We also provide evidence that the earnings premium is likely to be explained by improved access to urban formal employment, political and human capital accumulation. However, in spite of the off-farm employment gain for all cohorts, we find that the positive earnings premium of military service is mainly concentrated among the pre-1970 cohort.     

非农就业提高农村居民幸福感了吗？

农村劳动力非农转移已经成为常态,对农村居民的福利水平产生了深远影响。文章基于体验效用假设,构建了工农要素流动下农村居民的幸福函数,并基于2018年中国家庭追踪调查(CFPS)农村调研数据,实证分析了非农就业影响农村居民幸福感的效应、机制与情境。结果表明:非农就业在总体上促进了农村居民幸福感提升,但却存在一定的"伊斯特林悖论"关系,即短期非农就业能够显著促进幸福增长,但长期非农就业对幸福增长的促进作用是有限的,甚至出现停滞或反向抑制状态;其内在机制主要在于非农就业过程中农村居民的需求层次逐渐由生存需要转向尊重和自我实现需要,但长期非农就业并不能显著提升外出务工农村居民的社会地位感知;非农就业对农村居民幸福感的促进效应,在本地非农就业和跨省流动的就业情境下更为显著,在女性群体、高中层次受教育程度群体中相对更高,且伴随农村居民的年龄增长呈现边际递减规律。基于此,文章提出创造本地就业市场、关注非农劳动力的就业需求变化、加强非农就业劳动力职业技能培训等针对性政策启示。