Do land transfers reduce the effects of labour costs on agricultural land abandonment?

We account for the endogeneity problem in the statistical analysis of recent survey data from 5 provinces in southwest China and show that the positive effects of labour costs on ALA are weaker if farmers' demands for land transfers are met. Meanwhile, public interventions in land transfers by local governments or village collectives reduce the ALA caused by the high labour costs. Our analysis implies that well-functioning land rental markets in less-developed regions effectively alleviate the aggravating effects of high labour costs on ALA.