How land retirement programs affect crop production: Evidence from China's Grain for Green Program

Abstract

This paper evaluates the impact of one of the world's largest land conservation programs—China's Grain for Green Program—on crop production, and examines whether land retirement policies can balance ecological goals with food security objectives. By combining detailed county‐level crop production data with remote sensing data, our difference‐in‐differences estimates suggest that the program significantly reduced total cropland area but increased total crop production. This unexpected increase in production can be explained by the program's significant increase in labor input, fertilizer use, and multiple cropping on the remaining cropland. More importantly, we find that the program improved the local microclimate and substantially alleviated the damage of weather stress on crop production. Our findings suggest that, under certain institutional conditions, it is possible to adopt land‐use policy to protect the ecosystem without compromising food security.