Types of employment and well-being of rural residents: A multinomial endogenous switching regression application

Abstract

This study examines how participation in different types of employment affects rural residents' well-being, measured by household income and life satisfaction. Unlike previous studies that only consider binary employment status, we measure three employment types (pure farm work, mixed work, and pure non-farm work). Using the Chinese Social Survey data, we employ a multinomial endogenous switching regression model to address selection bias issues due to observed and unobserved heterogeneities and estimate the treatment effects simultaneously. The results suggest that relative to pure farm work, participation in pure non-farm work and mixed work significantly increases rural residents' well-being by increasing household income and life satisfaction. We also find that the income and life satisfaction enhancing effects of participation in pure non-farm work and mixed work (relative to participation in pure farm work) are generally larger for males (relative to females). These findings enrich our understanding of rural residents' employment choices. Rural development programs should consider helping pure farm workers (especially rural women) to participate in mixed and non-farm work to maximize rural residents’ well-being and boost sustainable rural development.