Sowing Seeds of Mobility: The Uneven Impact of Land Reform

Title: Sowing Seeds of Mobility: The Uneven Impact of Land Reform (with Ting Chen, Jiajia Gu and Jin Wang)

Abstract: Mobility barriers hinder structural transformation and economic growth. This paper examines how land market frictions constrain labor mobility. In developing countries, rural households risk losing land if they stop cultivating it. This implicit barrier is made explicit through China’s hukou system. Typically, wife remains in agriculture while the husband moves to non-agriculture. Using two land reforms that reduce this barrier, we construct a novel county-level reform index and show that land reforms induce rural women to leave agriculture at higher rates than rural men and lower urban women’s employment and wages relative to urban men. Incorporating this index into a two-sector model with intra-household employment decisions replicates the observed uneven impacts and reveals significant effects on agricultural productivity.