How Much Expropriation Hazard Is Too Much? The Effect of Land Reallocation on Organic Fertilizer Usage in Rural China

Ying Bai, James Kung and Yang Zhao


In China, land is reallocated on either a full-scale or a partial basis. By employing a unique farm survey that deliberately draws a distinction between full-scale and partial land reallocations, and by decomposing their respective expropriation risk effects, we find that the significantly negative effect of expropriation risk on organic fertilizer usage is driven solely by full-scale reallocation. Consistent with this finding, a reduction in the predicted expropriation hazard rate by half leads to a sizable increase of 491% in organic fertilizer usage in villages with a history of full-scale reallocation, and has an estimated productivity effect of 19.1%. (JEL O12, Q15)

This article requires a subscription to view the full text. If you have a subscription you may use the login form below to view the article. Access to this article can also be purchased.

Purchase access

You may purchase access to this article. This will require you to create an account if you don't already have one.