Conservation Payments, Liquidity Constraints, and Off-Farm Labor: Impact of the Grain-for-Green Program on Rural Households in China

By E. Uchida, Scott Rozelle, Jintao Xu. 2009

270 citations recorded by the source corpus.

This study evaluates the labor response of rural households participating in the Grain-for-Green program in China, the largest payments for ecosystem services program in the developing world. Using a panel data set that we designed and implemented, we find that the participating households are increasingly shifting their labor endowment from on-farm work to the off-farm labor market. However, the effects vary depending on the initial level of human and physical capital. The results support the view that one reason why the participants are more likely to find off-farm employment is because the program is relaxing households' liquidity constraints. Copyright 2009, Oxford University Press.

Subfields: Economics and Econometrics, Global and Planetary Change, Soil Science

View Paper: https://www.semanticscholar.org/paper/ce14ef5a3721f90370ac16bf49dd8c7dd8e07b97

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Citations in the corpus

Land Tenure Arrangements and Rural-Urban Migration in China (2011, background): “There are a number of studies that focus on how access to credit or sufficient liquidity may limit migration out of rural areas, in relation to the role of the Slopping Land Conversion Programme (SLCP) in alleviating those liquidity constraints (Groom et al. 2006; Uchida 2008 ).”
China’s conversion of cropland to forest program: a systematic review of the environmental and socioeconomic effects (2016, unknown): “In the CCFP pilot region (Shaanxi, Gansu, and Sichuan), a series of papers describe a shift in the allocation of labor in sloping landscapes from agriculture, initially to on-farm livestock investment, followed by an increase in off-farm jobs [23, 24, 52, 53].”
Grain Subsidy, Liquidity Constraints and Food security—Impact of the Grain Subsidy Program on the Grain-Sown Areas in China (2014, background): “…that small farm households in China usually face incomplete credit markets (Feder et al., 1990; Rozelle et al., 1999; Simtowe and Zeller, 2006; Uchida et al., 2009; Dong et al., 2010), thus, liquidity constraints cause households to have underemployed and ill-allocated productive assets which…”
Show Me the Money: Do Payments Supply Environmental Services in Developing Countries? (2010, methodology): “Using household panel surveys, Uchida, Rozelle, and Xu (2009) find that the SLCP allowed households to shift their labor allocation from on-farm to off-farm labor by relaxing households’ liquidity constraints.”
The Different Dimensions of Livelihood Impacts of Payments for Environmental Services (PES) Schemes: A Systematic Review (2018, background): “For instance, SLCP payments were higher than the opportunity costs of retired land (Liang et al., 2012), while the payments of the PSAH in Mexico were lower than alternative incomes (Alix-Garcia et al., 2014; García-Amado et al., 2011; Scullion et al., 2011).”
Economic Factors Affecting Diversified Farming Systems (2013, background): “Conservation payments, liquidity constraints, and off-farm labor: impact of the Grain-for-Green program on rural households in China.”
Forest Conservation and Slippage: Evidence from Mexico’s National Payments for Ecosystem Services Program (2012, background): “Indeed, Uchida, Rozelle, and Xu (2009) find evidence of labor market effects in China due to the national PES program (Sloped Land Conversion Program).”
Only One Tree from Each Seed? Environmental Effectiveness and Poverty Alleviation in Mexico's Payments for Ecosystem Services Program (2015, background): “However, previous empirical studies simulate tradeoffs based on baseline profiles of beneficiaries (Uchida, Rozelle, and Xu 2009, Wünscher, Engel, and Wunder 2008, Gauvin et al. 2010) whereas our assessment includes measured household impacts.”
Parks versus PES: Evaluating direct and incentive-based land conservation in Mexico (2017, unknown): “Research on China’s payments for reforestation programs traces possible increases in welfare through additional assets and reallocation of labor to off-farm opportunities (Uchida et al. 2007, 2009).”
The Sloping Land Conversion Program in China: Effect on the Livelihood Diversification of Rural Households (2015, background): “As a policy intervention, the SLCP aims to improve the asset holding of rural populations and is considered to be a strategy to overcome this barrier as it enables rural households to relax their liquidity constraints by endowing them with additional financial assets such as program subsidies (Kelly”