The impact of social capital on rural residents ' income and its mechanism analysis —Based on the intermediary effect test of non-agricultural employment

Abstract

Agricultural, rural, and farmer-related issues are of pivotal importance, significantly influencing the evolution of our party, nation, and state. Central to these multifaceted issues, the farmer's plight is three-fold: low earnings, the hardship of income augmentation, and a pronounced socioeconomic divide between rural and urban areas. The crux of resolving these agricultural, rural, and farmer-related issues lies in elevating the income levels of farmers. Utilizing data from the China Family Panel Studies (CFPS) 2018, this study probes the influence of social capital on the earnings of rural dwellers and delves into the intermediary role of non-agricultural employment. The findings indicate a substantial and positive correlation between social capital and rural income. The conclusions remain robust even after applying instrumental variable methods to counteract endogeneity. Mediation analysis reveals that social capital significantly boosts opportunities for non-agricultural employment, which, in turn, enhances the income of rural residents. Therefore, the roles of social capital and non-agricultural employment in income augmentation warrant careful consideration.

Keywords

• Social capital
• Non-agricultural employment
• Income of rural residents
• Mediating effect