This paper empirically examines the impact of property rights changes on agricultural growth in China’s different regions. A property rights model based on the Hayekian proposition of property rights for extended order is developed, considering variables that capture aspects of property rights such as managerial area, marketization, productive investment, and human capital. Empirical testing is conducted by the error component method using pooled cross-section and time-series data.
Empirical findings for the 1987-1993 period indicate that the property rights variables of managerial area, marketization, human capital, and productive investment affect agricultural growth in eastern and western regions. Clearly, the institution of secure property rights is highly oriented toward the promotion of farmers’ incentive and productivity, and will thus be conducive to sustainable agricultural growth in China’s rural areas.
