Could farmland titling alleviate rural income-oriented relative poverty? Evidence from China

Purpose This study aims to examine the impact of farmland titling on alleviating rural income-oriented relative poverty, drawing upon Coase's theory on the consistency of factor allocation and income distribution. Specifically, it seeks to ascertain whether farmland property rights empower farmers by influencing factor allocation and income structure. Design/methodology/approach We conduct an empirical analysis using data obtained from a random sample of in-person interviews with farmers in nine Chinese provinces. To address endogeneity and dummy instrumental variables, we use the conditional mixed process method and endogenous switching probit model. Multiple mediation effect models are utilized to explore the impact mechanisms of farmland titling on rural income-oriented relative poverty. Findings Our results indicate that farmland titling significantly reduces income-oriented relative poverty in rural areas by facilitating factor flow and optimizing income structure. Notably, we observe that farmland titling leads to labor force (temporary migration) and farmland reallocation, subsequently, increasing the wage income proportion and decreasing agricultural income proportion. However, it does not significantly affect farmers' business income proportion or farmland rent income proportion. Overall, findings highlight farmland titling's role in reducing income-oriented relative poverty, emphasize strengthening farmland reforms to advance equitable development and common prosperity in rural developing countries. Originality/value This paper offers three distinct contributions. First, it advances Coase's theory on the consistency of factor allocation and income distribution to rural contexts, addressing prior neglect of its application to relative poverty. Second, it clarifies farmland's role in rural relative poverty via a multi-layered mechanism in a synthetic perspective, unlike existing focus on absolute poverty or single factors. Third, it proposes targeted farmland system reform policies to reduce rural relative poverty, moving beyond generic recommendations in prior literature.