The Impact of Agricultural Technology Adoption of Income Inequality in Rural China

This study analyzes the impact of government efforts to increase agricultural incomes on income inequality in rural China. It collects and analyzes survey data from 473 households in Yunnan, China in 2004. In particular, it investigates the effects of government efforts to promote improved upland rice technologies. Our analysis shows that farmers who adopted these technologies had incomes approximately 32 percent higher than non-adopters. While much of this came from increased incomes from the selling of upland rice, adopters also enjoyed higher incomes from other cash crops. We attribute this to technology spillovers. Despite substantial increases associated with the adoption of improved upland rice technologies, we estimate that the impact on income inequality was relatively slight. This is primarily due to the fact that low income farmers had relatively high rates of technology adoption.Rural economic development; Chinese economic development; upland rice; rural-urban income inequality; agricultural income policy