trends suggest a strongly declining trend in most of these variables inside compared to outside Chengdu, a glance at changes between pre-and post-reform period for those in the treatment and control suggests that reform may indeed have had a positive impact in a number of dimensions. For example, the area share of vegetables increased from 14% to 21% inside and 10% to 13% outside the boundary. But value of output and net revenue per mu actually decreased, suggesting that econometric analysis that controls for other factors will be needed.

The bottom panel of table 1 illustrates that the period coincided with expansion of subsidies for grain, seed, and other inputs. Yet, if anything, the absolute magnitude and growth rate of these was more pronounced outside as compared to inside the Chengdu border. Similarly, the rural pension and cooperative medical schemes were rolled out over the period but our data suggest that net receipts from these schemes were, if anything, lower to for households inside the prefecture boundary than outside.

Treatment and control areas may already have followed different growth trajectories before reforms. The standard way to check whether may have been the case is to test for parallel trends.<sup>13</sup> As discussed in detail below, we cannot reject the hypothesis of no significant differences in pre-reform trends between households inside and outside the border for overall household welfare and the share of income derived from agriculture non-farm employment, migration, and local wages and, with one exception, individuals’ time use, and agricultural yields and profits. Some significant pre-reform trends exist, however, with respect to use of agricultural inputs and crop choice. They point towards marked declines in agricultural assets (- 18% in Chengdu vs. +35% in villages outside the prefecture boundary) and use of inputs (-38% vs. -16%). Output shares of wheat and other grains increased and those of oil crops decreased in Chengdu while the opposite was true for households in neighboring counties. Also, key interventions in place during the period of concern are a new rural pension scheme (Lei _et al._ 2013), cooperative medical scheme (Wagstaff _et al._ 2009), and agricultural subsidies (Huang _et al._ 2011; Meng 2012). While these are funded centrally, disbursements may vary by prefecture and we include information on the amounts received in such schemes, in addition for a wide range of household-level observables, in our regressions.

# **3.2 Nature and cost of the certification process**

To quantify costs of the reform, we use the overlap between the counties in our sample and a village survey administered in May 2014 on either side of comparable stretches of the administrative border of Chengdu prefecture(Deininger _et al._ 2015). Characteristics of the certification process for different types of land are described in table 2. The average village has an area of about 7,500 mu (5 km<sup>2</sup> ) of which some 51% were

> 13 To test for presence of pre-reform trends for variable _Yit_ in household _i_ in year _t_ , we use the pre-reform sample to estimate  ��� ������� � ����� �������� ����where _Ci_ is an indicator variable for location inside Chengdu and _Tit_ is a time. With _β2_ and _β2_ + _β3_ as the pre-reform trend for households outside and inside the Chengdu boundary, significance of _β3_ .implies that the parallel trends assumption can be rejected and we report the level of significance for this variable in table 1, col. 7.

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