Land titling and self-operated non-farm business engagement among rural households in China

This study examines the association between China’s new round of rural land certification and rural households’ self-operated non-farm business engagement. Using 2015 China Household Finance Survey microdata for 7,676 rural households, the outcome records whether a household engaged in industrial or commercial production and business activities during the preceding year. The baseline logit estimates show that titled households have a 2.2 percentage-point higher predicted probability of such engagement, conditional on observed covariates and province fixed effects, equivalent to about 22.2% of the sample mean. As an auxiliary endogeneity-sensitive specification, we estimate a recursive conditional mixed process model using the leave-one-out village/community certification rate; the estimated marginal difference is 5.3 percentage points under its identifying assumptions, but the cross-sectional data cannot establish whether certification preceded business establishment. Potential-pathway tests are most consistent with land transfer and formal loan access/use, whereas the household-wide non-farm employment share is not statistically significant. Subgroup estimates are statistically significant for development-oriented business engagement and non-poor households, but not for the corresponding comparison groups. The findings document a conditional association between documented land-use rights and self-operated non-farm business engagement and suggest that land-market governance, rural finance, and asset-building policies remain important complements.