Property Rights, Labour Markets, and Efficiency in a Transition Economy: The Case of Rural China

28 Pages Posted: 30 Dec 2002

See all articles by Dwayne Benjamin

Dwayne Benjamin

University of Toronto

Loren Brandt

University of Toronto - Department of Economics; IZA Institute of Labor Economics

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Abstract

We investigate the consequences of imperfect factor market development for farm efficiency in North China. We estimate the extent to which an inverse relationship in farm productivity can be attributed to the administrative (as opposed to market) allocation of land, combined with unevenly developed off-farm opportunities. Using a new household survey, we find considerable inefficiency in the use of labour. This inefficiency is alleviated by external labour markets and, to a limited degree, by administrative reallocations. The reallocations do not go far enough, however, which raises important questions about constraints on rental activity and property rights formation more generally.

JEL Classification: Q15, O12

Suggested Citation

Benjamin, Dwayne and Brandt, Loren, Property Rights, Labour Markets, and Efficiency in a Transition Economy: The Case of Rural China. Canadian Journal of Economics, Vol. 35, pp. 689-716, 2002. Available at SSRN: https://ssrn.com/abstract=342530

Dwayne Benjamin (Contact Author)

University of Toronto ( email )

105 St. George Street
Toronto, Ontario M5S 3E6 M5S1S4
Canada
416-978-6130 (Phone)
416-978-6713 (Fax)

Loren Brandt

University of Toronto - Department of Economics ( email )

150 St. George Street
Toronto, Ontario M5S 3G7
Canada
416-978-4442 (Phone)
416-978-6713 (Fax)

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

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