When Property Rights Meet Social Capital: The Differentiated Impact of Land Certification on Farm Mechanization

Improving agricultural machinery inputs and enhancing the efficiency of agricultural production is an important way to promote agricultural modernization and address food security challenges. Based on a new round of progressive land tenure certification policy (LTCP) in China, this study uses data from the Chinese Family Database (CFD) and the China Household Financial Survey (CHFS) for the period 2011–2015 to analyze the relationship between China's agricultural property ownership reform and farmers' agricultural machinery investments, employing difference-in-difference (DID) methods with fixed effects and clustering. The empirical results show that the implementation of the ownership certification policy increases agricultural machinery investment by improving access to financial credit for households with large-scale agricultural land. Further analysis reveals that the policy has only promoted agricultural machinery investment among farming households with richer social capital. The findings of this study provide a detailed mechanism for understanding the effect of property stabilization on agricultural machinery investment and offer both theoretical and empirical insights for other developing countries seeking to promote agricultural production through improving the stability of land certification programs.