Land consolidation and farm production: A difference-in-differences approach with plot exchange in two provinces of Vietnam
IDEC-DP2_10-2.pdf 2.94 MB
This study evaluates the impacts of land consolidation on household farm production with panel data on 618 rural households in 2010, 2012, 2014, and 2016 in two provinces of Vietnam: Ha Tay and Nghe An. We apply a difference-in-differences approach to address the endogeneity in household participation in plot exchange – a policy for consolidating fragmented cropland in Vietnam. Our approach differs from those of previous studies that typically use a household’s number of plots with little treatment of the endogeneity problem. Our results show that plot exchange reduced the number of annual crop plots operated by a household by nearly 50 percent. This land consolidation subsequently improved farm irrigation and the application of machinery. While the impact on farm productivity was statistically insignificant, land consolidation via plot exchange reduced farm labor supply for crop production. Thus, land consolidation could release labor from farms and stimulate an off-farm rural economy.
IDEC DP2 Series