The impact of social security policies on farmland reallocation in rural China

Purpose The purpose of this paper is to explore the causality between social security policies and farmland reallocation in rural China. Design/methodology/approach It quantitatively analyzes the impact of each ongoing social security policy on farmland reallocation based on a data set from the 2011 China Health and Retirement Longitudinal Study (CHARLS, 2011). Findings The study finds that the inclination of a village farmers’ collective to reallocate farmland due to changes in the village population increased if social security policies do not effectively cover the village because farmers rely primarily on income from farmland to cover their basic living expenses. However, if social security policies provide adequate coverage, then farmers do not rely entirely on on-farm income and the likelihood of farmland reallocation decreases. Furthermore, the effectiveness of social security policies includes not only coverage but also the sufficiency of the security policies provided. Research limitations/implications First, the authors use only cross-sectional data in this study, which may result in biased estimation and also limit temporal examination of the impact of social security systems, farmland reallocation and related policy variables. This limitation may be especially important in China because the country is undergoing a rapid socioeconomic transition. However, the research is constrained by the available data. Furthermore, there could be endogeneity problems that are difficult to address, given the current data set. These problems could involve the impacts of village-level economic, natural and social variables, the implementation of related public policies (land development and consolidation, land expropriation, etc.) and other economic variables. Practical implications These findings may provide implications for related policy reform in the near future. Originality/value These findings may facilitate a recognition and understanding of the causality between social security policies and farmland reallocation in rural China.