The Impact of the Expiration of Subsidies for the Sloping Land Conversion Program on Farmer Households' Income and Its Mechanism: Based on the Perspective of Non-farm Employment

Exploring the impact of the expiration of the first round subsidies for the Sloping Land Conversion Program (SLCP) on farmer households' income will help to provide empirical evidence for improving the long-term mechanism for consolidating the SLCP, increasing farmer households’ income and achieving the overall goal of rural revitalization. Based on the survey data of 897 farmer households in the Ningxia Hui Autonomous Region, Gansu and Hunan provinces, this paper uses a multi-period DID to investigate the impact of the expiration of the subsidies for the SLCP on farmer households' income, and tests its specific impact mechanism from the perspective of non-farm employment. The results show that the expiration of the subsidies for the SLCP prompts farmer households to participate in non-farm employment and increase their income, so that their total income level does not fall but rises. This effect has initially appeared in the year when the subsidies for the SLCP expire, and shows a trend from strong to weak over time. Heterogeneity analysis found that the expiration of the subsidies for the SLCP has a relatively weak effect on the income level of farmer households with small scale of SLCP, while it has a significantly negative impact on the income level of elderly farmer households. Based on test results above, this paper puts forward policy recommendations from the aspects of enhancing farmer households' ability to transfer employment, formulating differentiated assistance measures and timely issuing follow-up policies for the SLCP.