Labor productivity and migration in Chinese agriculture - A stochastic frontier approach

The authors use a stochastic frontier approach with an endogenous error specification to measure China's agricultural labor requirement. They measure a significant apparent labor surplus, but find that it is correlated with factors that affect the incentives of farmers to leave the land. Thus their findings support the hypothesis that declines in the agricultural labor force are not adequately measured, whereas their surplus estimates are generally consistent with other studies using other approaches. The measured surplus ranges from 35% to 40% of the labor force, with significant differences by region. By 1995, there were perhaps 120 million farmers who were either in fact or potentially better employed elsewhere. (C) 1999 Elsevier Science Inc. All rights reserved.