13 Jul 2026
In many rural areas of China, a seemingly contradictory scene plays out: young adults leave for city jobs, yet the family farmland doesn't lie fallow — instead, they hire others to work it. If farming barely turns a profit, why pay extra for labor? The answer, it turns out, is not a miscalculation but a carefully calibrated household survival strategy.
Hao Huang, a PhD student at International Business School Suzhou (IBSS), Xi’an Jiaotong-Liverpool University, together with her supervisor Professor Steven Dellaportas and co-authors Zhang Fushun and Li Heyun, has had their research paper “Household Labor Portfolio Optimization: Agricultural Hiring Decisions Under Mixed Livelihood Strategies” accepted for publication in the International Review of Economics and Finance. The journal is ranked ABS 2, ABDC A, and CAS 2.
Using nationally representative micro-level data from the China Household Finance Survey (CHFS), the research team found a striking pattern: the more family members engaged in off-farm work, the more likely the household is to hire agricultural labor — and in greater numbers. Counterintuitive as it sounds, the logic holds up. Off-farm employment drains the family of farmhands, especially during peak seasons. At the same time, while wage income is higher, it is also less stable. The crops in the field, however, provide a "safety net" — a basic food supply and a fallback option. Agriculture acts as an invisible insurance policy for the household, one worth maintaining even when it doesn't pay off immediately.
The study further reveals that when household members participate in formal pension programmes, the link between off-farm employment and labor hiring weakens significantly. This suggests that when external social protection is more reliable, the household's "insurance demand" for land decreases.
More importantly, while hiring labor may reduce farm-level profitability, it frees up family members to take on higher-paying off-farm work — and overall household income improves. In other words, rural households are not choosing between farming and working in the city; they are using hired labor as a tool to capture both the high income from off-farm jobs and the security of farmland. It is, in effect, treating the family's labor as a flexible "asset portfolio."
This research offers a fresh lens for understanding rural household decision-making in China: farmers are not passive producers, but shrewd "portfolio managers" of their own labor and livelihood. The study contributes to academic literature on agricultural labor markets, household finance, and structural transformation, while offering practical policy insights for strengthening rural social protection, facilitating orderly labor mobility, and promoting sustainable rural development.
About the Researchers
Hao Huang is a PhD student at International Business School Suzhou (IBSS), Xi’an Jiaotong-Liverpool University. Her research interests include behavioral accounting, corporate governance, and green accounting. His work focuses on decision-making behaviours, risk responses, and sustainable development among individuals, families, and organisations under structural transformation.
Prof. Steven Dellaportas is currently a Professor of Accounting at the XJTLU School of International Business, with over 30 years of academic and teaching experience. His primary research and teaching areas include accounting ethics, with a particular focus on fraud, ethical behavior, and ethics education. He serves on several editorial boards and is currently Co-Editor of the Accounting Section for the highly regarded Journal of Business Ethics. He has published numerous articles in international peer-reviewed journals, is lead author of two textbooks, and has developed professional development content on ethics for major accounting bodies.
About the Journal
International Review of Economics and Finance is a leading international academic journal dedicated to publishing high-quality original research in the fields of economics and finance. It covers a broad spectrum of topics including macroeconomics, microeconomics, international finance, corporate finance, and behavioural finance, with a strong emphasis on theoretical innovation and empirical rigour. The journal maintains a strict peer-review process and is widely recognised for its methodological standards and policy relevance.
13 Jul 2026