Agric. Econ. - Czech, 2014, 60(5):219-231 | DOI: 10.17221/97/2013-AGRICECON

Rural income diversification patterns and their determinants in ChinaOriginal Paper

Jianmei ZHAO
China Academy of Public Finance and Public Policy, Central University of Finance and Economics, Haidian District, Beijing, China

The article investigates the major rural income diversification patterns and their determinants in the context of China. Based on the data from a rural household survey, we first categorize the rural income diversification patterns according to the industry and the location in which the income is generated. Then we apply a Bayesian multinomial probit model to examine the determinants of various types of the rural income diversification. The major results demonstrate that a larger family size stimulates households to undertake various income diversification patterns, but its effects are discounted by an unproductive population structure within the household. Another interesting discovery is that a rural household chooses its income diversification pattern by referring to the surrounding neighbourhood; when most farm families depend on off-farm activities to boost their income, the individual household is more likely to follow the surrounding households by participating in the off-farm or mixed income activities or to migrate out to earn its income.

Keywords: Bayesian multinomial probit, income generation, rural households

Published: May 31, 2014  Show citation

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ZHAO J. Rural income diversification patterns and their determinants in China. Agric. Econ. - Czech. 2014;60(5):219-231. doi: 10.17221/97/2013-AGRICECON.
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