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Location and economic resilience in rubber farming communities in southwest China

Shaoze Jin (Research Center for Rural Economy, Ministry of Agriculture and Rural Affairs, Beijing, China) (Institute of Development and Agricultural Economics, School of Ecomics and Mananagment, Leibniz Universität Hannover, Hannover, Germany)
Jikun Huang (China Center for Agricultural Policy, School of Advanced Agricultural Sciences, Peking University, Beijing, China)
Hermann Waibel (Institute of Development and Agricultural Economics, School of Ecomics and Mananagment, Leibniz Universität Hannover, Hannover, Germany)

China Agricultural Economic Review

ISSN: 1756-137X

Article publication date: 2 November 2020

Issue publication date: 1 June 2021

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.

Keywords

Acknowledgements

We acknowledge the funding support from the National Natural Science Foundation of China (71761137002; 71673008). This study was also conducted in the framework of the Sino-German “SURUMER Project”, funded by the Bundesministerium für Bildung und Forschung (BMBF), FKZ: 01LL0919.

Citation

Jin, S., Huang, J. and Waibel, H. (2021), "Location and economic resilience in rubber farming communities in southwest China", China Agricultural Economic Review, Vol. 13 No. 2, pp. 367-396. https://doi.org/10.1108/CAER-06-2020-0153

Publisher

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Emerald Publishing Limited

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