Agricultural production services and farmland reallocation among wheat-growing households in China

Abstract

Agricultural production services may influence farmland allocation, but their associations with farm expansion and land retention may differ. This study examines how service use relates to operated farmland area and land rented in and out among wheat-growing households in four Chinese provinces. Using cross-sectional survey data, we measure service use by expenditure and, alternatively, by the number of production stages served, which is less mechanically related to cultivated area. We also use two-part models to distinguish rental participation from rented-in area conditional on participation. Fixed-effects estimates from a separate three-wave rural panel provide a complementary longitudinal check. Service use is positively associated with operated area and rented-in area and negatively associated with rented-out area, although the strength of the rented-out association varies by measure and model specification. Service-stage breadth is associated with participation in renting in land, but not significantly with conditional rented-in area. In the longitudinal panel, wheat service expenditure per mu is positively associated with operated area and wheat-growing area. These findings are consistent with agricultural production services being linked to farmland reallocation through both expansion and land-retention margins. Proposed labor-substitution and expected-return mechanisms remain correlational. Because the main survey is cross-sectional and limited to active wheat growers, the findings should not be generalized beyond comparable wheat-producing settings.