Ryerson University Economics Effects of Land Tenure on Migration Report This is an upper division liberal studies course. It has a writing requirement. You

Ryerson University Economics Effects of Land Tenure on Migration Report This is an upper division liberal studies course. It has a writing requirement. You have to write an essay of 1500-2000 words. What is the structure of essay? -Begin with a few lines of introduction such as “This essay discusses…” -Then write about the main article. This is the main part of the essay. This should write about things such as (i) what is the topic of the main article, which specific questions it wants to address, (ii) what is its methodology (does it look at a data, or is it a model or is it an experiment), (iii) how does it contribute to the existing knowledge on the topic. -You need to carefully read the introduction and concluding section of the main article where the authors make clear their contributions. -Articles may have math equations, statistical tests etc. You don’t have write about those technical details. What is needed is that you convey an overall understanding of the article. -After discussing the main article, you write about related research: one article from past research, one article from future research. This does not have to be as detailed as the main article. Write a brief summary of one paragraph each. -In the end, you write a paragraph or two about your own thoughts such as (i) what you learnt about the topic after reading the three articles, (ii) what in your view are possible limitations of the main article, (iii) what are some of the questions you think should be addressed in future studies. -Finally you list the references. The references must have the three articles: the main and two from related research (you can have additional references if you are using those, but this is not required). The essay should follow the APA citation style (American Psychological Association) which is standard for social sciences. World Development Vol. 39, No. 1, pp. 123–133, 2011
Ó 2010 Elsevier Ltd. All rights reserved
0305-750X/$ – see front matter
www.elsevier.com/locate/worlddev
doi:10.1016/j.worlddev.2010.08.009
Land Tenure Arrangements and Rural–Urban Migration in China
KATRINA MULLAN
North Carolina State University, Raleigh, NC, USA
PAULINE GROSJEAN
University of San Francisco, CA, USA
and
ANDREAS KONTOLEON *
University of Cambridge, Cambridge, United Kingdom
Summary. — Obstacles to internal migration in China contribute to inefficiency, inequality, and land degradation. Academic and policy
debate has primarily focused on discrimination against rural migrants on arrival in urban areas. Meanwhile, barriers to migration out of
rural areas have received less attention. This paper examines the role of incomplete rural property rights in the migration decisions of
rural households. We examine the relationship between tenure insecurity and restrictions on land rentals, and participation in outside
labor markets. The results indicate that tenure insecurity reduces migration. This relationship is particularly pronounced on forest land,
which has implications for the conservation of recently replanted forest areas.
Ó 2010 Elsevier Ltd. All rights reserved.
Key words — land tenure security, land rental rights, rural–urban migration, China, Asia
1. INTRODUCTION
specifically considers whether rural land tenure arrangements
act as a further constraint on migration. By focusing on
“push” factors at the origin of rural–urban migration, this paper fills a gap in the literature on migration, which has mainly
focused on “pull” factors. 4
This paper also contributes to the literature on the impact of
land rights on household decision making. China has a distinct
system of land tenure for agricultural and forest land. Village
collectives officially own the land, but individual households
have fixed-term contracts to use the land for their own production activities. Over time, these land use rights have become
closer in nature to private property, with longer contracts, reduced frequency of land reallocations, and increased opportunity to rent land to others. However, this process is not
complete, and questions remain about both how meaningful
the impacts have been in practice and the extent to which further reforms are required (Deininger & Jin, 2009). Furthermore, the increasing incidence of land expropriation for
urban expansion and infrastructure development has compromised the effectiveness of the enhanced land-use contracts
(Ding, 2007). So far, analysis of the land tenure reforms has
mainly focused on the impact of rural land tenure on investment and productivity (e.g., Carter & Yao, 1999; Deininger &
Jin, 2003; Jacoby, Li, & Rozelle, 2002). The second key contribution of this paper is to shed light on an alternative way in
Despite the vast scale of migration in China, 1 there is evidence that constraints on labor mobility remain. These contribute toward both rural–urban and regional inequality and
reduce overall labor productivity at a national level (Au &
Henderson, 2006). As an indication of the extent of such disparities, Yang and Cai (2003) estimate that the ratio of nonagricultural to agricultural incomes for a sample of 36 other
countries is usually around 1.5. In comparison, the same ratio
in China has varied between 2 and 3 since the early 1980s.
Constraints on migration also increase the pressure on the rural environment, leading to land degradation and deforestation
(Liu et al., 2005). To describe the source of obstacles to migration, the literature has mainly focused on the potential destinations of migrants. The household registration (hukou) system
has been described as the major impediment to migration,
by preventing rural migrants from accessing all the benefits
associated with legal residence in cities. Whalley and Zhang
(2007) argue that removing hukou restrictions would significantly increase migration flows and reduce regional income
disparities. 2 Another widely described obstacle to migration
relies on the extent of labor market segmentation and discrimination against rural migrants. For example, Meng and Zhang
(2001) find significant evidence for occupational segregation,
some of which may also be traced back to the hukou system
(Lu & Song, 2006).
As a result of awareness of the impacts that hukou-related
constraints on labor mobility have on inequality, economic
efficiency, and rural environment, there have been reforms
aimed at reducing these constraints. 3 These reforms will remove restrictions on migration and should therefore increase
flows of labor and reduce wage inequalities over time. However, as hukou constraints are eased, labor mobility will not increase if other barriers to migration remain. This paper
* We would like to acknowledge the financial support of the China Council for International Cooperation on Environment and Development as
well as the assistance of the School of Environmental Sciences of Beijing
University in implementing the survey used in this paper and particularly
the help received by Prof. Shiqiu Zhang. We are grateful for the comments
received by Prof. Tim Swanson, Dr. Ben Groom, Dr. Shinwei Ng, Prof.
David Pearce, Prof. Jerry Warford, and Prof. Jintao Xu. Final revision
accepted: August 26, 2010.
123
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WORLD DEVELOPMENT
which land tenure may affect household welfare and economic
productivity. In particular, this paper considers the impact of
the current systems of rural property rights on household
migration decisions.
Following Besley’s (1995) description of the positive link
between land rights and investment decisions, we can identify two relevant arguments according to which land management arrangements would influence migration decisions
in the context of China. First, migration is associated with
a risk of expropriation since migration entails a decrease
in household size. Hence, under the current system of rural
land tenure in China, this may induce redistribution of some
of the household land in order to maintain egalitarian land
holdings (Rozelle & Li, 1998). Second, migration is encouraged by the development of land exchange rights. The ability to rent land while away reduces the opportunity cost of
lost agricultural labor. 5 We develop a theoretical model in
which we show that moving away from existing property
rights arrangements toward those characterizing a market
economy (and thus alleviating migration constraints) may
in fact have countervailing effects on migration. This is then
tested econometrically using household survey data on
migration decisions and property rights to agricultural and
forest land.
The rest of the paper is organized as follows. We begin in
Section 2 by reviewing the literature on the determinants of,
and constraints on, migration in China. In Section 3, we then
consider how the current land tenure arrangements relating to
agricultural and forest land may affect household migration
decisions. Section 4 describes the data while Section 5 presents
the empirical strategy and the econometric results. Section 6
concludes.
2. IMPACTS AND DETERMINANTS OF MIGRATION
IN CHINA
Evidence suggests that constraints on migration in China
have multiple negative impacts. First, at the national
level, Au and Henderson (2006) find that China is “underurbanized,” which contributes to substantial unexploited
economies of scale. As a result, they estimate potential productivity gains of at least 35% for the majority of prefecture
level cities. In addition to these productivity effects, Yang
and Cai (2003) and Whalley and Zhang (2007) attribute
high rural–urban inequality in China to restrictions on
migration. At the level of individual households, Taylor,
Rozelle, and de Brauw (2003) and Du, Park, and Wang
(2005) find that migration significantly reduces poverty in
rural areas, through increases in income and relaxation of
credit and liquidity constraints. Lastly, there are also substantial environmental impacts of constraints on migration.
Poor regulation and land scarcity in rural China have led
to deforestation for timber and agricultural land creation,
conversion of grasslands, and over-intensive use of agricultural land (Xu et al., 2006; Zhang et al., 2000). These have
in turn resulted in soil erosion, flooding, landslides,
droughts, sandstorms, and losses of biodiversity (Liu
et al., 2005; Wang et al., 2007). Attempts are being made
to address the poor regulation of rural land use, through
programs such as the Sloping Land Conversion Program
and the Natural Forest Protection Program (Bennett,
2008; Zhang et al., 2000). However, without economic development in rural areas, or migration to urban areas, incentives will remain unchanged, limiting the long-term
effectiveness of the programs. We look separately at the
impacts of land tenure for both agricultural and forest land,
as these have potentially different environmental implications.
The migration decision is generally modeled as a function of
the difference between rural income and expected urban income, for either the individual migrant (Harris & Todaro,
1970) or the migrant-sending household (Stark, 1978; Stark
& Bloom, 1985). This basic model can be adjusted with other
factors that affect the costs or benefits of migration such as
transport costs, living costs in urban areas, risk aversion,
and non-monetary costs and benefits.
The impact of land tenure on migration has received little
attention in the international literature. However, it has been
raised as a potentially important issue in the Chinese context.
Zhao (1999) tests the permanent income hypothesis using
household survey data and finds that households treat remittances from migrants as temporary, and consume only a small
proportion of the additional income. Based on similar evidence, it has been argued that rural–urban migrants in China
are more likely than those in other countries to migrate temporarily due to the characteristics of the agricultural land tenure
system (Yang, 1997). This is because households risk losing
their rights to agricultural land if they migrate permanently,
which creates an additional cost to migration in the form of
lost future income. The hypothesis has not been tested empirically, but we use household survey data to test a similar model
in the following sections of this paper. Other theoretical work
focused on Chinese institutions has suggested that various
market constraints (Groom et al., 2010; Uchida et al., 2009)
and agricultural production quotas and taxes (Rozelle et al.,
1999; Fleisher & Yang, 2006; Zhao, 1999) may also affect
migration decisions.
Previous empirical studies on the determinants of migration
have found that young, single adults without dependents are
more likely to migrate; men migrate more frequently than women; and those with more agricultural land are less likely to
migrate (Rozelle et al., 1999; Zhao, 1999; Zhao, 2005). Education and income have mixed impacts (Zhao, 2005). However,
Rozelle et al. (1999) find that farmers from poor villages are
more likely to migrate, and Zhao (1999) finds that a larger initial cash holding reduces the likelihood of migration. Due to a
lack of social security provision in rural areas, ill health of elderly parents reduces the probability of migration for adult
children (Giles & Mu, 2007). Rozelle et al. (1999) explore
the impacts of a set of village-level institutions including security of property rights and rights to transfer land, as well as access to credit, and whether farmers are subject to crop
production quotas. They find that production quotas and tenure security are not important, while the ability to both rent
land and access credit have positive impacts on migration.
This paper updates the empirical analysis of land tenure impacts in light of reforms to the both hukou system and rural
property rights. It also extends it to forest land, as well as agricultural land.
3. ROLE OF LAND TENURE IN MIGRATION
DECISIONS
This section discusses the characteristics of land tenure
arrangements in China and formulates theoretical predictions
regarding their impact on household migration decisions.
(a) Rural land tenure in China
Agricultural and forest land in China are subject to what
may be described as “quasi-private” property rights (Kung,
LAND TENURE ARRANGEMENTS AND RURAL–URBAN MIGRATION IN CHINA
2002). Although rural households have held individual rights
to use the land since the 1980s, these rights are not complete.
Liu, Carter, and Yao (1998) detail four aspects of land rights
that can vary among Chinese villages: residual income rights,
unencumbered use rights, rights to secure possession, and
transfer rights. We focus on the last two of these, each of
which is discussed in detail below. As a result of a gradual
strengthening of overall property rights since the 1980s, residual income rights and unencumbered use rights are now fairly
universal. In contrast, secure possession and transfer rights
still vary substantially between villages. In addition, it remains
the case that rights to land can only be transferred temporarily
(i.e., through rental agreements), rather than sold outright.
This limits the extent to which land can be used to finance
migration or used as collateral for obtaining credit.
Rural land is managed under the Household Responsibility
System (HRS), through which households are allocated landuse rights. Under this system, land officially remains under collective ownership, but is allocated among village households to
cultivate as they choose. When the HRS was initially introduced, land could not be transferred between households,
and was subject to periodic reallocation at the discretion of
the village leader. Reallocations were intended to account
for changes in population and the formation of new households. The Rural Land Contracting Law (RLCL), implemented in 2002, aimed at strengthening the households’
rights of secure possession by enforcing 30 year land-use contracts; disallowing large-scale reallocations of land and limiting small-scale re-adjustments; and permitting transfers of
land between households (Ping Li, 2003). However, despite
this, there is evidence that households face a continued risk
of land reallocation: Deininger and Jin (2009) look at the incidence of land reallocations that are not technically permitted
under the RLCL. They find that in a sample of 8000 households from 800 villages across China, approximately 1/3 experienced reallocations of land during 2002–04. Tao and Xu
(2007) similarly found evidence of land reallocation continuing despite the introduction of the RLCL.
The tenure insecurity over agricultural land under the HRS
is exacerbated by the risk of land expropriation for urban
expansion and infrastructure development (Tao & Xu,
2007). Rapid economic development, combined with high
population density, has created high demand for rural land
to be used for urban expansion and infrastructure projects.
This has resulted in the widespread use of compulsory land
acquisition (Chan, 2003), with what many argue to have been
insufficient compensation (Guo, 2001). Since 2004, the Chinese
constitution has in fact had a clause stating that private property may be expropriated, but that it must be for “public use”
and that “just” compensation must be provided (Liu, 2005).
However in practice, local governments have the authority
to determine how “public use” is defined, while at the same
time they have strong incentives to expropriate land for urban
development because of the high prices that the land can be
sold to private developers for once the designation is changed
from rural to urban (Deininger, Jin, & Rozelle, 2007). In addition, in most fully fledged market economies, the concept of
“just” compensation is related to the market value of the land;
but in rural China, the lack of well-defined property rights or
functioning land markets makes this difficult, if not impossible
to achieve (Ding, 2007).
In addition to the problem of tenure insecurity, land transfer
markets also continue to be thin. Land transfers that do not
affect the underlying contract with the village collective are
technically permitted, subject to notification of the village leader. However, although land rentals increased after the 2002
125
tenure reforms, Deininger and Jin (2007) find that contracts
remain informal and unwritten, and are frequently made with
relatives. In the case of both land reallocations and land transfers, one factor in the incomplete implementation of the
RLCL appears to be a lack of awareness of its provisions:
Deininger et al. (2007) found that although both local governments and village leaders undertook extensive dissemination
of information about the Law, only 21% of village leaders
were aware that land transfers were permitted, and around
half of village leaders and households were aware that reallocation of land was no longer permitted.
Land tenure arrangements relating to collective forest land
in the south and southwest of China are similar to those concerning agricultural land, while forest land in the northeast of
China is almost entirely state owned (Wang, van Kooten, &
Wilson, 2004). The HRS was applied to collective forest land
in the mid-1980s, a few years after it was introduced in the
agricultural sector. Households were allocated plots of forest
land or waste land on which trees could be planted, as well
as areas of forested land. Both these land types are held under
contract, and individual households have the rights to manage
the land for timber. Any trees planted by the household belong
to them, but trees planted previously by the collective do not,
and the revenue from harvesting the latter is shared between
the household and the collective (Liu, 2001). The majority of
villages also retain some forest land that is collectively owned
and managed. The situation relating to forest land rental is
similar to agricultural land, in the sense that it is permitted,
but not common.
In the case of forest land, an additional source of tenure
insecurity has been introduced by the Natural Forest Protection Program. This program prohibits harvesting of timber
on forest land. It was intended to apply only to state-owned
land. However, it has been expanded to cover collectively
owned land, which many describe as equivalent to a “taking”
of the property rights of the collectives and the households
with land-use rights (Katsigris, 2002; Miao & West, 2004;
Shen, 2001; Zuo, 2002).
(b) Theoretical hypotheses about the impact of land tenure on
the household migration decision
We now consider how the land tenure arrangements
described in the previous section might be expected to affect
household decisions to migrate away from rural areas. There
are two possible ways in which migration could be affected.
These relationships are shown formally in Appendix 1.
The first link between land tenure and labor allocation decisions arises if migration results in an increased risk of land
expropriation, in other words, a reduction in tenure security.
Migration entails a decrease in household size. Due to the
scarcity of rural land and the incomplete implementation of
the RLCL, this may induce redistribution of some of the
household land in order to maintain egalitarian land holdings
(Deininger et al., 2007). The incentive for this becomes stronger as some land is requisitioned for urban or infrastructure
development (Tao & Xu, 2007). In this context, a household
considering whether to allocate labor to migration will
account for the increased risk of land expropriation in a future
period, resulting from the reduction in household size. The effect of this increased risk may be viewed as similar to the effect
of a tax on migration, and reduces the likelihood of migration.
However, we also consider the outcome if …
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