Agricultural Land Rights Confirmation, Clan Network, and Farmers’ Investment in Production and Operation

Abstract

This study is based on micro-survey data on rural household transfers in China. This study uses a multiple linear regression model (to analyze the relationship between variables), an instrumental variable model (to solve potential endogenous problems), and an intermediary effect model to explore the impact of farmland rights confirmation and clan network on farmers’ investment in production and operation and the relationship between clan network confirmation of farmland rights and farmer household investment. The research shows that: (1) The confirmation of farmland rights in China substantially bolsters farmers’ investments in agricultural production and operation. It serves as a secure foundation for land property rights, elevating farmers’ confidence and significantly contributing to the growth of rural economies and the improvement of farmers’ income levels in the Chinese context. (2) In the Chinese context, the existence of clan networks exerts a discernible adverse influence on farmers’ investment decisions in agricultural production and operation. This is primarily attributable to the restricted flow of information within these networks, the enforcement of stringent social norms, and the prevalence of risk-averse attitudes. These factors collectively act as barriers, dampening farmers’ enthusiasm for investment and impeding effective decision-making. (3) Importantly, the confirmation of agricultural land rights in China serves as a counterbalance to the inhibitory effects of clan networks. It achieves this by mitigating information asymmetry and reducing cooperation risks. This proactive approach not only promotes but also facilitates farmers’ investments in agricultural production and operation within the Chinese context. Consequently, land rights confirmation emerges as a key driver of increased rural investments in China. This study conducts in-depth research on the impact of farmland ownership confirmation and clan networks on farmers’ investment behavior and the mechanism of action, which provides a useful reference for formulating relevant policies, such as increasing the authority of cultivated land, promoting the modernization of clan networks, cultivating modern management capabilities, etc.

1. Introduction

The pursuit of excellence within agriculture is inherently intertwined with the advancement of high-quality development and the establishment of a modern socialist nation (Luo Biliang, 2022 [1]; Tu Shengwei, Zhang Yibo, 2023 [2]). As China’s economy continues to thrive and citizens’ income levels improve, the public’s expectations for food safety, nutritional value, health, and environmental sustainability are on the rise (Adamopoulos, Tetc., etc. [3]). By the first quarter of 2023, the total import and export value of agricultural products had reached $83.38 billion, marking an 11.6% year-on-year increase. Among these figures, exports amounted to $23.5 billion, exhibiting a 7.4% year-on-year rise, while imports totaled $59.88 billion, reflecting a 13.2% year-on-year increase. As a critical pillar supporting food production and supply, the quality and sustained output of agriculture have become the focal point of broader societal concern. In this context, the investment decisions made by farmers in their production and operations take on paramount importance. These decisions directly impact agricultural product yield and quality. (Lagakos, D., Mobarak, A.M, etc., 2023 [4]). By investing in contemporary agricultural facilities, cutting-edge cultivation methods, efficient machinery, and top-tier processing techniques, farmers can bolster productivity and output, concurrently trimming production expenses and satisfying consumers’ demand for high-quality, safe, and environmentally conscious agricultural products.

As a pivotal component of rural reform, the confirmation of agricultural land rights represents a fundamental measure aimed at elucidating and safeguarding land rights and interests (Hu Wen, Zhang Jinhua, etc., 2020 [5]). In the context of rural reform, which often encompasses broader socio-economic and governance changes, securing agricultural land rights is a fundamental step towards enhancing rural livelihoods and enabling sustainable development. It provides a foundation for rural communities to participate more effectively in economic activities, including modernizing agriculture, accessing credit, and making long-term investments in land development and infrastructure.

Presently, academic research predominantly revolves around several facets. Firstly, the confirmation of farmland rights lays the groundwork for ensuring stable land rights (Gao S, He Y, 2023 [6]), consequently stabilizing farmers’ expectations for future contracts (Chau TN, Scrimgeour F, 2023 [7]), bolstering farmers’ economic incentives, and prompting higher levels of investment in farmland. The confirmation of farmland rights alleviates farmers’ concerns regarding land-related risks, substantially enhances the security of farmland property rights, diminishes the uncertainty surrounding farmland investment, and amplifies investment motives concerning farmland (Ma Junkai, Li Guangsi, 2023 [8]). Secondly, the process of clarifying and segmenting the rights of farm households in land contracting ensures that their interests remain intact during farmland transfers and addresses various stakeholders’ claims over farmland, subsequently elevating farmers’ investment levels in agricultural production and resulting output (Li Yi, Luo Jianchao, 2022 [9]; Muhetar Shadiq, Abdurehman Abdikranmu, etc., 2023 [10]). Lastly, the confirmation of agricultural land rights aids in resolving issues associated with land transfers and capital circulation, fostering a conducive environment for farmers to engage in land transfers, pursue scale-oriented operations, and heighten resource utilization efficiency (Hu H, Wang W, etc., 2023 [11]; Barajas J A R, 2023 [12]). The current phase of farmland rights confirmation embraces multi-purpose land title certificates endowed with mandatory legal effects, spurring the effective allocation of farmland resources. This empowers farmers to transfer land less suitable for cultivation, encouraging investments in marginal land over the long term (Hu X, Chen Z et al., 2023 [13]).

The clan network, as a social network, represents a form of social capital formed through connections and cooperation among relatives, friends, and fellow villagers. Rooted in kinship and geographical ties, it forms a web of relationships that serve as a vital mechanism for individuals to thrive and flourish within traditional contexts (Pan Yue et al., 2019 [14]). Beyond its role in meeting the production and livelihood needs of people through provisions like education and security, it also imposes high moral expectations on its members. Functioning as a resource allocation mechanism (Wang Danli, 2023 [15]), it encapsulates interpersonal connections, resource sharing, and social trust. On one hand, clan networks facilitate information dissemination, risk mitigation, and resource assistance, thus incentivizing farmers to pursue more substantial and enduring investment strategies (Xu, F.; Zhang, X et al., 2022 [16]). Conversely, excessive dependence on the clan network can lead to resistance to new concepts and technologies among farmers, constraining the evolution and advancement of agricultural production methods (Huang, L.; Ma, M. et al., 2022 [17]; Hong Mingyong; Yang Xuejiao, 2021 [18]). Therefore, the objective of this paper is to conduct an in-depth exploration of the potential influence of farmland ownership confirmation and the clan network on farmers’ investment in production and management. This paper aims to comprehensively explore the potential influence of farmland ownership confirmation and the clan network on farmers’ investment in production and management. The goal is to enhance understanding of rural economic development and farmers’ income levels, offering actionable insights for policymakers to promote sustainable rural growth and improved living standards.

Our findings align with existing research, underscoring the crucial role of agricultural land rights confirmation in shaping farmers’ investment behavior. Studies conducted by Hong Mingyong, Yang Xuejiao (2021), and Niu Kunzai, Xu Hengzhou et al. (2022) have also emphasized the positive impact of agricultural land rights confirmation on farmers’ investment in production and operation, particularly in terms of bolstering their confidence and reducing concerns about land-related risks. Furthermore, our study lends support to Hong Mingyong’s (2017) and Hong Mingyong’s (2018) research on the influence of clan networks on investment decisions, particularly in mitigating the adverse effects of clan networks on investment willingness and decision-making efficiency. Additionally, we discovered that clan network density plays a moderating role in the relationship between agricultural land rights confirmation and investment behavior, consistent with the findings of Hong Mingyong and Yang Xuejiao et al. (2021). This underscores the significant impact of clan networks in facilitating and promoting farmers’ investments in agricultural production and operation.

This article hinges on a comprehensive field survey undertaken between March and April 2023 across 23 villages situated in 10 townships and towns within Meitan County, Pan County, Guanling County, and Sansui County of Guizhou Province. The study employs the most recent field survey data to scrutinize the correlation between farmland rights confirmation and the clan network and their influence on farmers’ investment in production and operations. This paper introduces two key innovations: an analytical framework elucidating the interplay between farmland rights confirmation, the clan network, and farmers’ investment, and the utilization of the latest field survey data collected in March–April 2023. These innovations enhance the theoretical understanding of investment in production and management and contribute up-to-date empirical evidence.

2. Literature Review and Theoretical Analysis

2.1. The Impact of Farmland Ownership Confirmation on Farmers’ Investment in Production and Operation

Farmland ownership confirmation plays a pivotal role in shaping farmers’ investment decisions in production and operation, and this multifaceted influence can be enriched by integrating insights from property rights theory, a foundational concept in economics. Property rights theory emphasizes the significance of well-defined and protected property rights in shaping economic behavior and outcomes.

A significant aspect of this influence is that the confirmation of agricultural land rights instills a profound sense of “reassurance” among farmers. This confirmation not only bolsters their confidence in land utilization but also alleviates concerns related to illegal land occupation or unauthorized transfers, as noted in the study by Katusiime J, Schütt B et al., 2023 [19]. By legally and efficiently securing their land rights through this confirmation process, farmers are shielded from the anxiety of losing their land or facing unwarranted transfers. This newfound legal safeguard fosters a heightened sense of security and optimism, subsequently encouraging a more proactive approach towards land investment, as evidenced by research conducted by Sun Xiaoyu, Yang Gangqiao, and others in 2023 [20].

Furthermore, property rights theory underscores the importance of well-defined property rights in resource utilization and allocation. Confirming agricultural land rights provides explicit knowledge regarding land area and geographic placement. This newfound clarity encourages farmers to harness and exploit more land resources, supporting comprehensive, long-term agricultural strategies (Muhetar Shadiq, Abdurehman Abdikranmu, etc., 2023 [10]). This, in turn, optimizes land utilization efficiency and augments overall output. The assurance of clear land property rights facilitates more seamless land transfers for rent or other benefits, allowing farmers to either expand their business scale by transferring land from others or consolidate their operations by acquiring land. This dynamic further galvanizes land development and utilization while propelling the allocation of land resources toward greater efficiency and large-scale agricultural production.

Moreover, as we delve into the role of farmland rights, we draw insights from property rights theory, which posits that well-defined and secure property rights play a pivotal role in shaping economic behavior (Manda S, Banda L. 2023 [21]). In this context, the affirmation of farmland rights aligns with these principles, fostering an environment conducive to increased farmer investment in production and operation (Adjei-Poku B, Afrane S K, Amoako C, et al., 2022 [22]). Providing a stable foundation for land property rights, not only bolsters farmers’ confidence but also encourages the adoption of advanced agricultural technologies and practices, thereby enhancing production efficiency and agricultural output.

Furthermore, the validation of agricultural land rights, as discussed within the framework of property rights theory (Maderson S. 2023 [23]), empowers farmers with a clear understanding of their property rights. This eliminates the ambiguity surrounding land ownership, instilling a heightened sense of security and assurance. Consequently, farmers are more inclined to invest their human and financial resources in land cultivation, management, and commercial activities. This assurance, rooted in property rights theory, sustains and promotes increased commitment to investment in agricultural production and operation, fostering economic development. In view of these multifaceted insights, it is posited that: Hypothesis H1: The affirmation of farmland rights may exert a positive impact on farmers’ investment in production and operation.

2.2. The Impact of Clan Networks on Farmers’ Investment in Production and Operation

Clan networks are deeply rooted in the preservation of family traditions and social order, establishing distinct organizational boundaries. While the rigid organizational structure of traditional societies may have diminished, family and clan ties continue to weave a complex fabric that envelops rural individuals within intricate networks (Mondey, A.; Beeri, I., 2023 [24]). Within these networks, rural life unfolds, potentially subjecting farmers to social expectations and public opinions that in turn shape their business decisions (Barreda-Ángeles, M.; Hartmann, T., 2022 [25]). The influence of family and clan dynamics can steer farmers towards conservative management strategies, driven by concerns about family and clan evaluations, which might inadvertently hinder large-scale investments and innovative endeavors.

Embedded within clan networks is a tendency to foster relatively insular information flows. This isolation can impede farmers’ access to novel external concepts, advanced technologies, and critical market information (Lankono C B, Forkuor D, etc., 2023 [26]). Such exclusive tendencies can be detrimental, even stifling corporate innovation by impeding the entry of outsiders, thereby curtailing knowledge dissemination and the exchange of personnel (Dong Jing, Zhao Ce, etc., 2019 [27]). The restricted diversity of information sources could predispose farmers towards conservative investment choices, rendering them less capable of agile responses to market shifts and challenges. As a consequence, innovation and adaptability in agricultural production might be stifled, with subsequent implications for farmers’ economic outcomes and competitiveness.

In the context of agricultural development, innovation stands as a pivotal driver. However, the inherent aversion to risk could cause farmers to approach innovative investments with caution, gravitating instead towards joint endeavors characterized by stability and tradition. This inclination could potentially deter investment in technological upgrades and modernized agricultural production methods (Jiang, X.; Wu, Q et al., 2022 [28]). Notably, traditional pension cultures tied to clan networks continue to wield considerable influence, potentially tempering the efficacy of novel rural insurance systems (Fan Chenchen, Li Wen, 2015 [29]). Particularly in resource-inefficient regions and areas with lagging market development, the impact of land transfer on resource allocation may be diminished by the constraining influence of clan networks (Hong Mingyong, Yang Xuejiao, 2021 [18]).

In light of these nuanced dynamics, the research hypothesis is formulated: Hypothesis H2: Clan networks might exert a negative influence on farmers’ investment in production and operation.

2.3. The Mediating Role of Clan Networks

Clan networks are intricate social structures defined by interconnected individuals bound by shared kinship, familial ties, and often geographical proximity. These networks are frequently marked by the presence of ancestral halls or clan temples, signifying their shared lineage and history. In the context of land property and rights, clan networks play a pivotal role in decision-making, resource allocation, and land utilization. However, their impact can vary depending on cultural and historical contexts, necessitating consideration of factors such as power dynamics, democracy, and their influence on equitable access to land resources.

Functioning as a potent social conduit, the clan network possesses a robust capacity for information transmission (Ji Xiaoqing, Zhao Jingyan, etc., 2022 [30]). It serves as a conduit for critical information related to the rights confirmation policy, conveying specifics on policy content, safeguarding rights and interests, and changing land use rights to farmers. This information proves pivotal for farmers, offering insights into the repercussions and advantages of the rights confirmation policy for their benefit. Moreover, Clan networks provide economic security during times of economic uncertainty, encouraging family members to be more willing to take risky investments (Wang, A.; He, K et al., 2021 [31]; Niu Kunzai, Xu Hengzhou et al., 2022 [32]). Post-confirmation, farmers might be confronted with novel investment prospects like land transfer, land development, and agricultural product processing. Clan networks disseminate such opportunities through word of mouth, enabling farmers to perceive expanded avenues for business growth following rights confirmation.

Offering social support and fostering a sense of identity, clan networks embolden farmers. Post-rights confirmation, farmers may encounter diverse investment choices and associated risks, with clan networks’ support and validation bolstering self-assurance and a sense of security (Xiang Yong, 2022 [33]). This empowerment translates to heightened determination and commitment to their investments in agricultural production and operations. The clan network’s identity-sustaining role cultivates a collective consciousness, reinforcing the notion that farmers are not solitary actors but backed by a robust social support system. This sense of security mitigates the anxieties and pressures associated with decision-making, rendering farmers more amenable to assuming certain agricultural investment risks.

Moreover, clan networks facilitate resource consolidation among farmers. Leveraging the clan network, farmers can pool familial resources and manpower, fostering collaboration and mutual aid (Jiang, X.; Ma, X et al., 2022 [34]; Fan Chenchen, Guo Jian, 2022 [35]). This dynamic enhances their competitiveness and innovation in agricultural production. The clan network engenders collaborative support and cooperation among farmers, enabling them to collectively address challenges and adversities. For instance, in an underdeveloped market economy, clan networks serve to optimize individual and family utility within the constraints of limited resources and technology (Chu Xiaoping, 2002 [36]).

Grounded in these intricate dynamics, the research hypothesis is articulated: Hypothesis H3: The confirmation of farmland rights shapes farmers’ investment in production and operation through the intermediary role of clan networks.

3. Materials and Methods

3.1. Sample Selection

Guizhou Province, situated in southwest China, serves as a vital regional hub, covering a vast land area of 176,200 square kilometers, with over half of it cloaked in lush forests. The region is currently in the midst of rapid urbanization and industrialization, resulting in substantial economic growth. Between 2015 and 2022, the total GDP surged from 1147.905 billion yuan to 2016.458 billion yuan, boasting an impressive average annual growth rate of 9.8%. The data collection for this study was meticulously conducted through field surveys in four counties from March to April 2023, ensuring comprehensive data representation. Various criteria, including economic development level, geographical distribution, and agricultural resources, were thoughtfully considered. Further details regarding the geographical location of the study area can be found in Figure 1.

Our research spans diverse regions within Guizhou Province, each carefully chosen for its unique significance in the context of agricultural land reform and property rights. These areas include Meitan County, which serves as a critical region for studying the impact of land ownership confirmation on farmers’ investments in production and operation, as it was one of the first experimental areas for agricultural property rights reform. Guanling County, particularly the Dingyun Community, renowned as “the first village of China’s rural land reform,” provides valuable insights into the influence of clan networks on farmers’ investment decisions. Sansui County, with its collection of documents related to the confirmation of agricultural land rights in Miao Village and Dong Village, offers significant research value for understanding the role of land rights confirmation in promoting farmers’ investments. Lastly, Pan County, recognized as the first location in Guizhou Province to implement the “three changes” reform in rural areas, allows us to investigate the interplay between clan networks, land rights confirmation, and farmers’ investment behavior in a unique reform context. These diverse regions collectively provide a comprehensive understanding of the complex dynamics surrounding agricultural land rights confirmation, clan networks, and farmers’ investments in production and operation within Guizhou Province.

A total of 1250 questionnaires were distributed to the targeted participants, and after excluding farmers who had not experienced land transfers, 1101 valid questionnaires remained, resulting in an effective response rate of 88.80%. The high response rate indicates a good level of participation and engagement from the respondents, enhancing the reliability and representativeness of the data collected for the research. With a large sample size, the research findings can provide valuable insights into the factors influencing farmers’ investment in production and operation.

3.2. Model Selection

Based on the survey data and previous studies by Hong Mingyong, Yang Xuejiao et al. (2021) [18], and Fan Chenchen and Guo Jian (2022) [35], we selected the multiple linear regression model for empirical analysis. The function is expressed as follows:

$$Inves{t}_{i_{}}=\alpha +{\beta }_{1}Cla{n}_i+{\beta }_{2}Confirmatio{n}_i+b_i{M}_i+d_i{N}_i+g_i{O}_i+{\epsilon }_i+{\varphi }_i$$

(1)

$Inves{t}_i$ is the production and operation investment of farmer $i$. $Cla{n}_i$ is the clan network variable, $Confirmatio{n}_i$ is the agricultural land confirmation variable, $M_i,N_i,O_i$ represent the variables of the three dimensions of individual characteristics of farmers, family endowment characteristics, and farming environment characteristics, respectively, $b_i,d_i,g_i,f_i$ are the coefficients of the control variable, ${\epsilon }_i$ is the random disturbance item, and ϕ_i is region fixed effects.

3.3. Variable Selection

Research Gap and Objectives: There exists a notable gap in the literature concerning the intricate relationship between farmland ownership confirmation, clan networks, and farmers’ investment in production and operation. Building upon the groundwork laid by previous researchers, this study delves into farmers’ production and management investment through the lenses of farmland rights confirmation and clan networks. It also aims to ascertain whether clan networks operate as a mediating factor between farmland rights confirmation and farmers’ investment in production and management. To mitigate the influence of other confounding variables affecting investment decisions, this study incorporates individual household characteristics, family resources, and the farming environment into the analytical framework.

Dependent Variable: Our dependent variable, “Farmers’ investment in production and operation”, is drawn from the work of Zhou Yueshu and Miao Zheyu (2023) [37]. This variable encompasses the cumulative value of agricultural inputs, such as agricultural machinery, production resources (seeds, fertilizers, pesticides, breeding), machinery usage, and maintenance funds. To mitigate endogeneity concerns, we initially log the raw investment values before conducting regression analysis.

Key Independent Variables: Inspired by the research of Niu Kunzai, Xu Hengzhou et al. (2022) [35] and Zhan Peng, Tao Yanjun (2023) [38], we use the proxy variable ‘Has your family obtained a new round of land title confirmation certificate?’ (0 = No; 1 = Yes) to represent agricultural land title confirmation. When farmers obtain land title confirmation certificates, they gain clear guarantees of land property rights, potentially increasing their investment confidence and thereby encouraging more substantial investments in agricultural production and operation.

Moreover, drawing insights from the work of Guo Yunan, Yao Yang et al. (2014) [39] and Guo Yunan, Wang Chunfei (2017) [40], “whether there are ancestral halls in the village” is chosen as a proxy for clan networks. As a symbol of traditional culture, ancestral halls often emphasize family cohesion and collective interests, which may affect clan members’ attitudes toward farmland ownership and agricultural investment.

Control Variables: To ensure precision and reliability in regression results, this study adopts a three-fold approach to control variables based on the research of Hong Mingyong, He Yufeng et al. (2020) [41]. Rural household individual characteristics include the head of household’s health status, gender, and party membership. Family endowment characteristics involve indicators like the purchase of agricultural insurance, the number of migrant workers, and family economic status. Cultivation environment characteristics encompass irrigation convenience, fertility levels, and the actual cultivated area. By controlling these variables, the research can better analyze the impact of factors such as clan networks and farmland ownership on farmers’ investment in production and management and thus more accurately reveal the independent impact of these factors on investment decisions. This will help obtain more reliable research results to guide relevant policy formulation and rural development planning. Descriptive statistics for the entire sample, including explanatory and control variables, are presented in

Table 1. Descriptive statistics of the whole sample.

Variable Name	Variable Definitions	Mean	Std.	Min	Max
Explanatory variable
Farmer production and operation investment	Take the logarithm of the investment amount of farmers’ agricultural production and operation	6.858	2.518	0.000	13.326
Explanatory variables
Clan network	0 = no ancestral hall; 1 = has ancestral hall	0.104	0.305	0.000	1.000
Farmland title confirmation	0 = No title confirmation certificate; 1 = Have title confirmation certificate	0.574	0.495	0.000	1.000
Individual characteristics of farmers
Healthy	1 = very unhealthy; 3 = fair; 5 = very healthy	3.764	0.827	1.000	5.000
Gender	0 = female; 1 = male	0.643	0.479	0.000	1.000
Party member	0 = non-party member; 1 = member party member	0.093	0.290	0.000	1.000
Family endowment characteristics
Agricultural insurance	0 = did not purchase agricultural insurance; 1 = purchased agricultural insurance	0.067	0.251	0.000	1.000
Number of migrant workers	Number of migrant workers, unit: person	1.084	1.191	0.000	8.000
Economic level	1 = very poor; 3 = average; 5 = very rich	3.024	0.781	1.000	5.000
Farming environment characteristics
Irrigation Convenience	1 = Very inconvenient; 3 = Normal; 5 = Very convenient	2.698	1.073	1.000	5.000
Fertility	1 = very poor; 3 = fair; 5 = very fertile	3.332	0.734	1.000	5.000
Cultivated area	Actual cultivated area, unit: mu	5.851	18.484	0.000	300.000

.

4. Results

4.1. Benchmark Model

The variance inflation factor (VIF) is a statistical indicator used to evaluate multicollinearity and is mainly used to determine whether there is a high correlation between independent variables in regression analysis. Recognizing the possibility of collinearity among the variables, a preliminary collinearity assessment has been conducted, as presented in

Table 2. Multicollinearity test.

Variable	Variable Definitions	VIF	1/VIF
Clan network	0 = no ancestral hall; 1 = has ancestral hall	1.030	0.975
Farmland title Confirmation	0 = no title confirmation certificate; 1 = have title confirmation certificate	1.030	0.974
Healthy	1 = very unhealthy; 3 = fair; 5 = very healthy	1.030	0.974
Gender	0 = female; 1 = male	1.020	0.984
Party member	0 = non-party member; 1 = member party member	1.020	0.984
Agricultural insurance	0 = did not purchase agricultural insurance; 1 = purchased agricultural insurance	1.030	0.973
Number of migrant Workers	Number of migrant workers, unit: person	1.020	0.976
Economic level	1 = very poor; 3 = average; 5 = very rich	1.030	0.969
Irrigation	1 = very inconvenient; 3 = normal; 5 = very convenient	1.150	0.868
Fertile	1 = very poor; 3 = fair; 5 = very fertile	1.220	0.821
Cultivated area	Actual cultivated area, unit: mu	1.060	0.940
Mean VIF		1.060

. The outcomes reveal that the variance inflation factors (VIFs) for all variables are below 2, indicating the absence of severe collinearity issues among them. Usually, a VIF value below 10 is also considered acceptable, but a VIF value below 2 is more likely to ensure that there are no significant collinearity issues between variables. Building on this assurance, we proceed with employing a multivariate linear regression model to delve into the implications of farmland rights confirmation and clan networks on farmers’ investment in production and operation.

Based on the core regression outcomes outlined in

Table 3. Benchmark regression results.

Variable	(1)	(2)	(3)	(4)	(5)	(6)
Farmland title confirmation		1.163 ***	1.195 ***	1.163 ***	1.106 ***	1.072 ***
		(0.148)	(0.148)	(0.148)	(0.147)	(0.143)
Clan network	−0.906 ***		−0.724 ***	−0.704 ***	−0.657 **	−0.548 **
	(0.249)		(0.243)	(0.243)	(0.241)	(0.234)
Healthy				−0.139	−0.120	−0.125
				(0.088)	(0.087)	(0.085)
Gender				0.346	0.317 *	0.242
				(0.153)	(0.151)	(0.146)
Party member				0.214	0.274	0.289
				(0.251)	(0.250)	(0.242)
Insurance					1.224 ***	0.980 ***
					(0.290)	(0.283)
Number of migrant workers					−0.192 ***	−0.179 **
					(0.061)	(0.059)
Economic level					−1.134	−0.126
					(0.093)	(0.092)
Irrigation						0.172 *
						(0.070)
Fertile						0.120
						(0.105)
Cultivated area						0.030 ***
						(0.004)
Constant	7.484 ***	6.811 ***	6.836 ***	7.149 ***	7.529 ***	6.470 ***
	(0.175)	(0.189)	(0.188)	(0.390)	(0.464)	(0.512)
F	17.390	43.080	31.880	17.450	15.210	18.480
Region	Controlled	Controlled	Controlled	Controlled	Controlled	Controlled
Adj-R2	0.023	0.071	0.077	0.082	0.104	0.160
Observations	1101	1101	1101	1101	1101	1101

Note: ***, **, * indicate significance at the 1%, 5%, and 10% levels respectively; the robust standard errors are indicated in brackets.

, this paper proceeds to elucidate the effects on farmers’ production and operational investment stemming from three essential dimensions: farmland ownership confirmation, clan networks, and the encompassing control variables.

• Impact of Farmland Ownership Confirmation on Farmers’ Investment: The influence of farmland ownership confirmation on farmers’ investment in production and operation emerges as statistically significant at the 1% level, aligning with the stipulations of Hypothesis 1. This outcome underscores that the implementation of farmland rights confirmation policies holds the potential to significantly bolster farmers’ investment behaviors in agricultural production, thereby enhancing production efficiency.

On one hand, the confirmation of agricultural land rights affords farmers enduring and secure land management rights, enabling them to conduct long-term planning and investments (Zhou Yueshu, Miao Zheyu, 2023 [37]). By possessing title confirmation certificates, the ambiguity and uncertainty surrounding land usage diminish, granting farmers greater autonomy in making decisions related to agricultural production and management. This, in turn, instills a willingness among farmers to make sustained investments in agriculture, ranging from acquiring advanced agricultural equipment to adopting efficient farming techniques, all aimed at heightening the yield and quality of agricultural output. On the other hand, the confirmation of farmland rights also widens the spectrum of investment prospects available to farmers. Armed with title confirmation certificates, farmers can utilize their land as collateral to secure loans and financial backing for expanding production capacities or enhancing agricultural techniques (Chau T N, Scrimgeour F, 2023 [7]). This newfound financial influx empowers farmers to invest more substantially in agricultural production, thus amplifying productivity and augmenting income streams.

2.

Influence of Clan Networks on Farmers’ Investment: The impact of clan networks on farmers’ investment in production and operation is statistically significant at the 1% level, aligning with the predictions in Hypothesis H2. Clan networks, as social structures with clear boundaries and traditional norms in rural contexts, can impose constraints on farmers’ investment decisions. Emphasizing family traditions and order (Mondey, A.; Beeri, I, 2023 [24]), clan networks may discourage farmers from adopting new agricultural technologies and investment approaches, affecting their investment behaviors.

Furthermore, clan networks might impede the adoption of innovative agricultural management models, such as land transfer and cooperative development (Hong Mingyong, Yang Xuejiao, 2021 [18]). Focused on familial mutual support, farmers may gravitate towards economic activities within family circles, steering clear of collaboration with external cooperatives or enterprises. This preference constrains opportunities for agricultural modernization and market-oriented ventures, subsequently diminishing farmers’ motivation to invest.

In some regions of Guizhou, clan networks may have inherited specific farming methods and agricultural customs. These practices could encompass cultivating particular crops or utilizing traditional farming tools. Such adherence to tradition may incline farmers to perpetuate existing methods in their investment decisions rather than exploring new planting techniques or embracing modern agricultural machinery.

Additionally, clan networks might limit farmers’ acceptance and adoption of new technologies due to the perpetuation of traditional ideas and practices within the clan. This resistance can potentially lead to the obsolescence of agricultural production methods, hindering the implementation of modern agricultural techniques and methods. Consequently, this limitation restricts improvements in agricultural efficiency and productivity.

In certain situations where family control and the preservation of family traditions are paramount, household-wide economic activities may prove more suitable. These activities, such as family agricultural production, agricultural product processing, and marketing, allow for cooperation among family members while fulfilling the economic needs of the family and upholding cultural values.

For a comprehensive understanding of the impact of farmland ownership confirmation and clan networks on farmers’ investment in production and operation, in conjunction with the control variables, please refer to Table 3. These findings offer valuable insights into the intricate interplay of factors that influence farmers’ investment decisions within the realm of agricultural production and management.

3.

Control Variables Analysis: The analysis of control variables provides valuable insights into their impact on farmers’ investment in production and operation.

Insurance: The presence of insurance coverage can significantly influence investment decisions as it is closely tied to risk management. Farmers with insurance coverage often exhibit a preference for making larger and potentially riskier investments, as they have a safety net to protect them against unforeseen events (Dong Jing, Zhao Ce, etc., 2019 [27]). By reducing the risks faced by farmers, insurance instills greater confidence and willingness to invest.

Irrigation Convenience: The level of irrigation convenience plays a pivotal role in investment decisions, particularly concerning the stability and yield of agricultural production (Niu Kunzai, Xu Hengzhou et al., 2022 [32]). Farmers with access to efficient irrigation facilities tend to be more inclined to invest in high-yielding crops. This is because they can exercise better control over soil moisture and irrigation frequency, leading to increased yields and profitability.

Arable Area: The impact of arable land area on investment is closely linked to resource availability. Farmers with a larger expanse of arable land often exhibit a stronger motivation to make expansion investments, such as introducing new crop varieties or constructing additional facilities. A larger arable land area translates into a wider array of investment opportunities, promoting agricultural diversification and facilitating industrial upgrades.

Number of Migrant Workers: The number of migrant workers can significantly affect investment, primarily due to its impact on household labor availability. The presence of migrant workers may lead to a shortage of labor within the household, consequently influencing investment decisions. When households face a labor deficit, it can limit their capacity for large-scale agricultural investments and management, ultimately impacting production levels and overall profitability.

In order to solve the endogeneity problem that may be caused by the inconsistent economic development levels of various counties, we introduce regional control effects in the regression. This measure helps eliminate potential differences between regions and ensures that our findings are more reliable and accurate.

4.2. Endogeneity Test

Addressing Potential Endogeneity Issues:

The regression analysis mentioned earlier may be susceptible to endogeneity concerns originating from two primary sources: the potential omission of variables due to selection or data limitations, and the presence of mutual causation leading to endogeneity in the results. To effectively tackle these potential endogeneity issues, this study adopts the instrumental variable (IV) method as a corrective measure, drawing inspiration from established practices outlined by Kung J K (1994) [42] and Deininger K, Jin S et al. (2014) [43].

The selection of “village arable land confirmation rate” and “average value of outer village ancestral halls” as instrumental variables for land tenure confirmation and clan networks stems from a comprehensive consideration of endogenous and exogenous factors. Firstly, the “village cultivated land confirmation rate” is chosen as the instrumental variable for land tenure confirmation. This selection is based on the notion that it may not be directly linked to farmers’ investment decision-making, thereby meeting the requirement of exogeneity. It is anticipated to mitigate the potential reverse causality between land tenure confirmation and investment. Secondly, the “average value of ancestral halls in outer villages” is selected as the instrumental variable for the clan network. Given the inherent complexity of the clan network, an external factor is chosen as the instrumental variable to address potential endogeneity issues. It is assumed that this variable is not directly influenced by farmers’ investment decisions, thus satisfying the exogeneity requirement. This approach helps provide a more accurate analysis of the independent impact of clan networks on investment. Overall, the selection of these two instrumental variables ensures the reliability of the research results and offers a clearer insight into the mechanisms by which land tenure and clan networks influence farmers’ investment behavior.

Specifically, the “village farmland confirmation rate” is designated as an instrumental variable for land confirmation, while the “average value of ancestral halls in other villages” serves as an instrumental variable for the clan network. The two-stage least squares (2SLS) method is subsequently employed to conduct the analysis (Hu H, Wang W et al., 2023 [11]). The IV approach involves a two-step procedure. In the first stage, instrumental variables are employed to predict the estimated values of the land tenure and clan network variables through regression. In the second stage, these predicted values are utilized as regressor variables, alongside other control variables, to estimate the impact of land tenure confirmation and clan network on farmers’ investment in production and operation. The empirical results are presented comprehensively in

Table 4. Endogeneity test.

Variable	7	8	9	10
	Clan Network	Investment in Agricultural Production and Operation	Farmland Title Confirmation	Investment in Agricultural Production and Operation
Clan network		−4.956 ***
		(0.740)
Farmland title confirmation				2.001 ***
				(0.275)
Proportion of ancestral halls in other villages	0.993 ***
	(0.085)
Confirmation rate of rural farmland			0.9986 ***
			(0.049)
Control variable	Controlled	Controlled	Controlled	Controlled
Wald test value	166.846 ***		193.930 ***
Weak instrumental variable test F statistic	193.004 ***		414.052 ***
Region	Controlled		Controlled
Number of observations	1101	1101	1101	1101
Adj-R2	0.168	0.521	0.282	0.241

Note: *** indicates significance at the 1% level; the robust standard errors are in brackets; the control variables are the same as those in Table 3.

.

An essential aspect of the IV method is the evaluation of the strength of instrumental variables to mitigate the potential weak instrument problem. An F statistic is calculated based on the first-stage regression, and its significance level is compared against a threshold (usually 10). If the F statistic significantly surpasses the threshold, it indicates a lack of weak instrument problems. The presented results indicate that the F statistic from the first-stage regression significantly exceeds the critical threshold, confirming the absence of a weak instrument problem.

4.3. Further Analysis

This study embarked on a multifaceted exploration, commencing with an investigation into the direct influence of farmland ownership confirmation on farmers’ investment in production and operation. The initial analysis unveiled a substantial and positive correlation between these variables, represented by a regression coefficient of 1.217. Subsequently, we delved into the intricate interplay between agricultural land rights confirmation and the clan network. This in-depth analysis shed light on the noteworthy influence of farmland ownership confirmation on the clan network. To comprehensively understand the dynamics at play, we introduced the clan network variable into the model, prompting a reevaluation of the relationship between farmland ownership confirmation and farmers’ investment in production and operation.

Remarkably, the subsequent findings affirmed the enduring connection between farmland ownership confirmation and farmers’ investment in production and management. Despite accounting for the influence of the clan network, the effect of farmland ownership confirmation remained statistically significant, albeit with a slight coefficient adjustment from its initial value of 1.217 to 1.170. This intriguing result suggests that, even when considering the clan network’s impact, farmland ownership confirmation continues to exert a substantial effect on farmers’ investment in production and operation.

Notably, this study also uncovered a robust and significant correlation between the clan network and farmers’ investment in production and operation. This signifies that the clan network acts as a partial intermediary mechanism in the relationship between farmland ownership confirmation and farmers’ investment behavior in production and management. The insights presented in

Table 5. Further analysis results.

Variable or Model	Confirmation of Farmland Rights → Investment in Production and Operation of Farmers	Confirmation of Agricultural Land Rights → Clan Network	Confirmation of Agricultural Land Rights → Clan Network → Investment in Production and Operation of Farmers
Total effect	1.237 ***
	(0.148)
Direct effect		1.196 ***
		(0.148)
Mediation effect			0.046
Mediation effect ratio			3.80%
Constant term	6.159 ***	0.134 ***	6.836 ***
	(0.085)	(0.140)	(0.188)
F	43.080	18.390	31.880
Region	Controlled	Controlled	Controlled
Adj-R2	0.071	0.068	0.078
Observations	1101	1101	1101

Note: *** indicates significance at the 1% level; the robust standard errors are in brackets; the control variables are the same as those in Table 3.

validate this observation, showcasing a notable intermediary effect of the clan network with a coefficient of 0.046, accounting for approximately 3.80% of the total impact. These findings firmly support the validation of Hypothesis H3, highlighting the clan network’s meaningful role as a mediator that shapes the relationship between farmland rights confirmation and farmers’ investment in production and operation.

4.4. Robustness Test

To enhance the robustness of the preceding regression results, a meticulous robustness test involving instrumental variable substitution was undertaken. Specifically, the “property of farmland ownership confirmation in the village” was replaced with the “property of ownership confirmation of other rural households in the village,” and the “proportion of ancestral halls in other villages and towns” was substituted with the “proportion of ancestral halls in other villages at the county level” (Ma Junkai, Li Guangsi, 2023 [8]). The comprehensive outcomes are summarized in

Table 6. Robustness check.

Variable	(11)	(12)	(13)	(14)
	Clan Network	Investment in Production and Operation of Farmers	Farmland Title Confirmation	Investment in Production and Operation of Farmers
Clan network		−6.466 ***
		(0.880)
Farmland title confirmation				2.093 ***
				(0.291)
Proportion of ancestral halls in other villages at the county level	0.993 ***
	(0.085)
Proportion of farmland title confirmation in the village			0.942 ***
			(0.050)
Control variable	Controlled	Controlled	Controlled	Controlled
Wald test value	151.780 ***		202.070 ***
F	136.890 ***		356.399 ***
Observations	1101	1101	1101	1101
Region	Controlled	Controlled	Controlled	Controlled
R²	0.146	0.153	0.262	0.128

Note: *** indicates significance at the 1% level; the robust standard errors are in brackets; the control variables are the same as those in Table 3.

.

Importantly, even after the substitution of instrumental variables, the correlation between farmland rights confirmation and farmers’ investment in production and operation remained significantly strong, with the coefficient direction aligning with the previous findings. This demonstration highlights the robustness of the regression results, reaffirming the reliability and validity of the earlier research findings. Additionally, the instrumental variable successfully passed the Wald endogenous test, and the F statistic from the initial-stage regression significantly exceeded the critical value of 10. This outcome confirms the absence of any weak instrumental variable concerns, further enhancing the credibility of the estimated results.

The insights gleaned from Table 5 distinctly illuminate that the confirmation of agricultural land rights bestows stable land management rights upon farmers, subsequently kindling heightened investment interest and enthusiasm in agricultural production. Consequently, this dynamic drives advancements in agricultural production and management, ultimately augmenting economic benefits. Simultaneously, the clan network, operating as a social network, exerts a counteractive influence on farmers’ investment behavior. This influence may stem from the clan network’s emphasis on upholding family traditions and order, thereby potentially limiting farmers’ investment decisions within the realm of agricultural production.

4.5. Heterogeneity Analysis

The presence or absence of land as a fundamental guarantee can induce distinct behaviors among farmers when confronted with the interplay of farmland rights confirmation and clan networks (Hong Mingyong, Yang Xuejiao, etc., 2021 [18]). These differences subsequently mold farmers’ investment choices in the realm of agricultural production and operation. To dissect this nuanced aspect, this study stratifies rural households into two distinct groups: those reliant on land as a foundational safeguard and those devoid of such reliance. This analytical approach seeks to contrast the impacts of farmland ownership confirmation and clan networks on farmers’ investment in production and operation within these distinct subsets.

The outcomes presented in

Table 7. Heterogeneity analysis.

Variable	Non-Land Security	Land Security
	Investment in Agricultural Production and Operation	Investment in Agricultural Production and Operation
Clan network	−0.707	−0.842 ***
	(0.499)	(0.277)
Farmland title confirmation	0.423	1.351 ***
	(0.318)	(0.169)
Constant	6.910 ***	6.119 ***
	(0.249)	(0.133)
Control variable	Controlled	Controlled
Region	Controlled	Controlled
Adj-R2	0.006	0.086
F	1.700	40.810
Observations	229	872

Note: *** indicates significance at the 1% level; the robust standard errors are in brackets; the control variables are the same as those in Table 3.

unveil a striking revelation: even within the cohort relying on basic security, the effects of farmland ownership confirmation and clan networks on farmers’ investment in production and operation remain notably pronounced. In this subset, the validation of agricultural land rights bolsters farmers’ faith in land-related investments. This bolstering is facilitated by the provision of clarity and security for land property rights, thereby engendering heightened investment inputs into agricultural production.

However, this does not hold true for the dispersion of information within the clan network. Constraints stemming from societal norms and a propensity towards risk aversion appear to temper the understanding and enthusiasm of this group towards potential investment prospects. For those who rely on land as their basic security, the importance of land ownership is paramount in their investment decisions. They perceive land as the linchpin of their family’s economic stability, which boosts their confidence in land ownership, encouraging long-term investments in land development, improvement, and enhanced agricultural practices. These farmers are more likely to leverage land rights confirmation to secure stable income, thereby enhancing the potential for agricultural modernization and increased efficiency.

In contrast, within the non-basic security stratum, the influence of both farmland title confirmation and clan networks on farmers’ investment in production and operation does not emerge as statistically significant. This phenomenon may be attributed to the prevailing skepticism held by these farmers regarding the effectiveness of the farmland title confirmation policy. In such contexts, the stability of their land property rights may not be a primary concern, and their pervasive skepticism curtails any discernible motivation to engage in investment endeavors.

Moreover, clan networks may have a limited influence on land-independent classes. Their economic activities are less intertwined with intra-family affairs, so clan network connections exert less influence on their investment decisions. In contrast, the land-dependent class is more likely to acquire resources, information, and cooperation opportunities through the clan network, rendering the influence of the clan network more apparent in their investment decisions.

5. Discussion

5.1. Main Results

The main findings of this study highlight the positive impact of farmland rights confirmation on the production, management, and investment choices of Chinese rural farmers. As an important policy measure, agricultural land rights confirmation plays a significant role in China’s rural areas. It provides farmers with stable land property rights protection and improves their investment confidence, which in turn significantly promotes the development of the rural economy and increases farmers’ income levels. The study also reveals the important role that clan networks play in the production and operation investments of Chinese rural farmers. It exerts a negative impact on information transfer, trust building, and risk sharing, mainly due to the limitations of information flow within these networks, strict social norms, and prevailing risk-averse attitudes. These factors work together to inhibit farmers’ enthusiasm for investment and affect effective decision-making. However, agricultural land rights confirmation policies have played a positive role in this context, partially mitigating the negative impact of clan networks. By reducing information asymmetry and cooperation risks, agricultural land rights confirmation policies actively promote farmers’ enthusiasm for investment in production and management. Therefore, the confirmation of agricultural land rights has become a key driving factor in increasing investment in China’s rural areas, helping to improve the level of the rural economy. The synergy of these two factors has brought greater development opportunities to China’s rural areas and made positive contributions to the sustainable growth of the rural economy and the improvement of farmers’ living standards.

5.2. Main Limitations

This study offers significant insights into the influence of farmland rights confirmation, clan networks, and farmers’ investment in production and operation. However, it is essential to recognize certain research limitations. Firstly, the analysis primarily concentrated on the impact of farmland rights confirmation and clan networks on farmers’ investment decisions, without considering potential influential factors such as policy, economic conditions, and cultural aspects. To gain a more comprehensive understanding of the agricultural investment landscape, future research should adopt a broader analytical framework that encompasses these factors. Secondly, the study relied on cross-sectional data for analysis, limiting its ability to capture changes and developments over time. To address this limitation, future research could leverage panel data, enabling the examination of information across different time points. This approach would allow for a more nuanced exploration of the dynamic relationships among farmland rights confirmation, clan networks, and farmers’ investment choices, shedding light on the evolving nature of these relationships and their implications for the farmland transfer process. In summary, while this study contributes valuable insights into the role of farmland rights confirmation and clan networks in shaping farmers’ investment behavior, it is crucial to acknowledge these research limitations and encourage further exploration in the field. Future studies that encompass a broader range of influencing factors and employ longitudinal data analysis will enhance our understanding of the complex interplay between farmland rights, social networks, and agricultural investments, ultimately contributing to more effective policy and economic development strategies in the rural context.

6. Conclusions

This study breaks through previous studies in several ways and provides novel insights into related fields. First of all, within the distinct context of China, the confirmation of farmland rights plays a pivotal role in bolstering farmers’ investments in agricultural production and operation. It serves as a sturdy foundation for ensuring land property rights, elevating farmers’ confidence, and making significant contributions to the growth of rural economies and the enhancement of farmers’ income levels.

Secondly, in the unique framework of Chinese society, the presence of clan networks exerts a distinct and discernible adverse impact on farmers’ investment decisions in the realm of agricultural production and operation. This impact can be attributed to several key factors, including the constrained flow of information within these networks, the imposition of stringent social norms, and the prevalence of risk-averse attitudes. Collectively, these elements act as formidable barriers, dampening farmers’ enthusiasm for investment and impeding their ability to make effective investment decisions.

Furthermore, notably, the confirmation of agricultural land rights in China emerges as a crucial counterbalance to the inhibitory effects of clan networks. It effectively mitigates information asymmetry and reduces cooperation risks. This proactive approach not only promotes but also facilitates farmers’ investments in agricultural production and operation within the specific context of China. Consequently, land rights confirmation stands out as a key driver of increased rural investments in the Chinese landscape.

Guided by the insights derived from these research outcomes, a set of actionable recommendations is articulated:

Enhancement of Farmland Rights Confirmation: It is advisable to channel efforts towards augmenting the promotion and implementation of farmland rights confirmation policies.

Modernization of Clan Networks: Recognizing the importance of integrating traditional clan networks with modern agricultural management practices, a two-fold approach is advocated.

Fostering Modern Management Competencies: A pivotal recommendation pertains to instigating a paradigm shift within clan networks towards contemporary concepts.

These findings provide useful insights for policymakers in various countries to promote sustainable rural economic growth and improve farmers’ living standards.

First of all, the positive impact of the farmland rights confirmation policy is not only within the country; other countries can also learn from and promote similar policies. Second, policymakers could consider promoting modernization within clan networks, encouraging information sharing, collaborative innovation, and shared risk. In addition, policymakers can consider how to optimize information delivery, trust building, and decision-making processes to facilitate a virtuous cycle of investment.

Future research can be carried out on the basis of the current research and continue to deepen the understanding of the impact mechanism of farmers’ investment decisions. In addition, more influencing factors can be considered, such as policy environment, cultural background, etc., to construct a more complex analysis framework. At the same time, by adopting a longer-term research design, it is possible to further study the long-term impact of farmland tenure and clan networks on investment behavior, as well as their contribution to the sustainability of rural development. These efforts will help to deepen our understanding of farmers’ investment behavior and provide more scientific guidance for actual policy formulation.