Land expropriation, household behaviors, and health outcomes: Evidence from China

Using a nationally representative dataset from China, we exploit an event study approach to trace out the consequences of land expropriation on household economic behaviors and health outcomes. The expropriated rural households receive an average compensation per capita of over 6 thousand yuan (60 percent of pre-event income) immediately after expropriation and thus have a higher income level. Among the people in these households, the likelihood of working in the agricultural sector decreases while that of working in the non-agricultural sector increases. Meanwhile, medical consumption per capita increases substantially by 0.4 thousand yuan and the saving rate rises by 14 percentage points. People in these households experience a significant improvement in subjective health status, in terms of self-reported health and depression, while their health-related behaviors do not change significantly. Overall, land expropriation influences the economic and health conditions of the affected rural households by providing additional liquidity.