This paper evaluates the impact of village-level land reallocations in China on household economic outcomes. Since land was decollectivized in China in 1983, village leaders have implemented regular forced reallocations of land designed to enhance intravillage equity and attain other policy goals. I estimate the impact of insecure tenure using the past history of land shifts as an instrument for current tenure insecurity, and find that an increase in the probability of losing the current plot yields a decrease in agricultural inputs and production of around one standard deviation. Though the costs of insecure tenure are high, structural estimates of the varying cost of reallocation across different villages suggest the choice to reallocate does reflect an optimizing process on the part of village officials, who reallocate where the net benefit is larger. However, the observed pattern of reallocations would be optimal only given an objective function for the village leader that places an extremely high weight on equity, and even given this objective function, there is evidence that village leaders may be making some costly mistakes.
This paper evaluates the strategies employed by households in rural China to allocate educational expenditure to children of different initial endowments, examining whether parents use educational funding to reinforce or compensate for these differences. Empirical results obtained employing early-childhood climatic shocks as an instrument for endowment, measured as height-for-age, indicate that parental expenditure is preferentially directed to the relatively weaker child. In response to the mean difference in endowment between siblings, parents redirect between 10 and 20% of discretionary educational spending to the child with lower endowment, and the effect is robust across multiple measures of climatic shocks and multiple measures of expenditure. This analysis is consistent with the hypothesis that parents use the intrahousehold allocation of resources to compensate for differences in endowment and thus in expected welfare among their children.
Given that land is the most important asset in developing economies, land reform can have a large impact on both equity and economic welfare. This paper exploits a natural experiment provided by the redrawing of state borders in south India in 1956 to analyze the economic impact of tenancy reforms. We identify linguistically matched pairs of localities within border districts that were assigned to different states in 1956, subsequently experiencing different land reform policies. Assuming the assignment of localities to states is quasi-random and the only channel through which this assignment affects land inequality is land reform, this identification strategy generates unbiased estimates of the impact of land reform employing matched pair fixed effects. The results show that land reform yields a decrease in measures of inequality in landownership of around 20%, primarily via transfers of land from upper caste landowners to middle caste tenants. However, the poorest households exhibit increased landlessness and dependence on agricultural labor, though they also benefit from an increase in agricultural wages. While the effect of land reform is substantial and persistent, the welfare implications are uncertain, particularly for the poorest households.