Study Of The Chinese Land-Lost Peasants Non-Agricultural Entrepreneurship

The progress of urbanization accompany with the redeployment of land resources. With the rapid urbanization process of china, more and more farmland is expropriated for non-agricultural application. However, farmland is the foundation of farmers’ life. Farmland is not only the basic source of income, but also employment place, guarantee and ties of various relations of production and life. For farmers who have lost their farmland, they lose basic livelihood ensure, low-cost lifestyle, and employment position. Together with existing compensation system of land expropriation fail to adapt current situation, the issue of land-lost farmers has became a key factor which impact badly on sustainable development of economy and social stability. Shown as the continued increase of disputes and social contradictions which caused by land expropriation and removal. Currently, land expropriation and removal becomes the focus of peasant petition. Solving the issue of land-lost farmers is very urgent doubtlessly.Peasants’ non-agriculture entrepreneurship is considered as an effective way to solve the issue of land-lost farmers employment, increase land-lost farmers’ income, improve land-lost farmers’status. At the same time, it creates more non-agriculture jobs to meet the huge demand of farmer employment. Land expropriation and removal could afford a considerable income to farmers, but how does wealth stimulate entrepreneurship is uncertain. On the one hand, wealth growth could weaken the motivation of entrepreneurship. Therefore, land-lost farms could lose their motivation after getting a large amount of compensation. On the other hand, wealth growth could partly or totally overcome the initial capital of entrepreneurship, and then promote entrepreneurial behavior of land-lost farmers happen.Because the urgency and complexity of land-lost farmer entrepreneurship issue, this thesis will take credit constraint as influence channel to research how does land expropriation and removal impact the behavior of non-agriculture entrepreneurship and enterprise scale. This research is helpful to understand what kind of the role of compensation would be played in land-lost farmers’future life? Whether compensation would afford any support for land-lost entrepreneurship? Whether single monetary compensatory is the best mechanism to solve the problem. To answer these questions would help us to understand whether credit constraint is the real problem land-lost farmer face in the progress of entrepreneurship, and then we can afford the help which is needed by land-lost farmers to urge entrepreneurial behavior to happen and solve survival problem.The main conclusions of this study: Firstly, land expropriation and removal fail to promote the behavior of non-agriculture entrepreneurship. Even there is an opposite impact. The author hold that the huge wealth which come from land expropriation and removal could partly or totally reduce the credit constraint land-lost farmers face, because the initial capital of entrepreneurship is not very high. However, land expropriation and removal fail to change the risk attitude of land-lost farmers, which is the attitude to entrepreneurship. In this case, even if land-lost farmers hold enough capital to start a business, they won’t do it. Farmers who go through land expropriation and removal, lose their farmland partly or totally is relied for existence. It makes farmers more conservative when they confront risk, and choose a stable job with a low risk, or continue to work for agricultural self-employed intimately.Secondly, industrial and commercial households could reduce the credit constraint land-lost farmers confront and expand the size of business. Research objects are the families which have established a business successfully. This success proves that household hold a optimistic attitude to risk. At the moment, maybe the operation capital is a more serious problem. Land expropriation and removal compensation contribute to reduce credit constraint and expand the scale of business.Compared to the existing literature, there may be two main innovations in this thesis:firstly, the innovation of the research problem. This thesis studies whether land expropriation and removal impact non-agriculture entrepreneurship, which is very specific. Research result of this study is valuable for reference about how to solve the problem of land-lost farmers. Secondly, the innovation of research method. From the existing literature, few articles research the relationship between land-lost farmers and non-agriculture entrepreneurship. In addition, research methods are usually theory and case analysis, but most absence is the empirical analysis which is supported by micro-data. Entrepreneurship behavior is complicated, land-lost farmers are special, qualitative analysis is very hard to measure how much does land expropriation and removal impact non-agriculture entrepreneurship objectively and accurately. This thesis utilizes micro-data of CHFS(China Household Finance Survey) to do empirical analysis, which is an innovation.