Too Risky to Focus on Agriculture? An Empirical Study of China’s Agricultural Households’ Off-Farm Employment Decisions

This paper investigates China’s agricultural households and their individual members’ off-farm labor supply decision in response to farm production risks and a number of other factors (e.g., demographic characteristics, farm characteristics, and local market features). Whether and to what extent farming risks may affect farmers’ off-farm employment in China are rarely studied. Our paper provides an empirical study to demonstrate that agricultural production risks significantly impact off-farm labor supply in rural China. The impacts of associated variables on households off-farm labor supply decisions are quantified using a sample of large⁻scale nationwide household finance survey in 2010. The results suggest that off-farm employment serves as a risk adaption strategy for Chinese farmers. Policy suggestions on retaining farmers to focus on agricultural production are discussed