Water savings through off-farm employment?

Purpose - The purpose of this paper is to gain more insight into the relationship between off-farm employment of rural households and water-saving investments and irrigation water use in rural China. Design/methodology/approach - Data from a survey held among 317 households in Minle County, Zhangye City, Gansu Province, covering the year 2007, are used for a probit analysis explaining investments in land leveling and for an ordinary least squares regression explaining irrigation water use per mu. Findings - Off-farm employment is not significantly related to investments in land leveling, but is negatively associated with water use per mu. In addition, the paper finds that the share of migrant students in a household is positively related to investments in land leveling. The results indicate the presence of major factor market imperfections in the research area, and confirm that the new economics of labor migration (NELM) approach is more relevant for analyzing off-farm employment and agricultural production in China than neoclassical economic theory. Originality/value - The paper expands the NELM approach towards the analysis of water-saving investments and water use. In addition, it distinguishes migrant students as an important category that should be taken into account in analyzing farm household decisions making.