Location and economic resilience in rubber farming communities in southwest China

authored by

Shaoze Jin, Jikun Huang, Hermann Waibel

Abstract

Purpose: In rural areas, geographic location is key to market access and labor mobility of farm households. This paper aims to investigate the opportunities and constraints of smallholder rubber farmers in southwest China to adjust to the changes in economic and institutional conditions, namely the declining rubber prices, emerging land rental markets and growing off-farm job opportunities. Design/methodology/approach: The empirical basis is a dataset of some 600 rubber farmers in Xishuangbanna Dai Autonomous Prefecture, Yunnan Province, collected in March 2015. The study uses instrumental variable and recursive bivariate probit models to account for possible endogeneity and selection bias. Findings: With rubber prices in decline, the elevation of rubber plantations is an essential factor for the costs of access to the local factor markets and influences farm households' possibilities to adopt coping strategies. Notably, we find a U-shape type of relationship between the location and renting-out land due to the decline in rubber profitability. Rubber producers in low elevations are better bestowed with access to local markets. Households in high elevations, where rubber planting came in later, can shift to new crops like tea. However, the economic resilience of farmers in middle elevations is low due to their higher adjustment costs. Originality/value: The paper provides a constructive basis for designing more location-specific development policies and can help avoid the past often ineffective blanket measures. Its implications have significant relevance for areas with similar conditions, for example, the remote, ethnic minority–dominated and mountainous rural areas in China.

Organisation(s)

Institute of Development and Agricultural Economics

External Organisation(s)

Ministry of Agriculture of the People's Republic of China
Peking University

Type

Article

Journal

China Agricultural Economic Review

Volume

13

Pages

367-396

No. of pages

30

ISSN

1756-137X

Publication date

01.06.2021

Publication status

Published

Peer reviewed

Yes

ASJC Scopus subject areas

Agricultural and Biological Sciences (miscellaneous), Economics and Econometrics

Sustainable Development Goals

SDG 2 - Zero Hunger, SDG 15 - Life on Land

Electronic version(s)

https://doi.org/10.1108/CAER-06-2020-0153 (Access: Closed)