How risk perception and loss aversion affect farmers' willingness to withdraw from rural homesteads: Mediating role of policy identity.

Government-guided withdrawal from rural homesteads is a sustainable solution to the problem of vacant rural residential land. Nonetheless, few studies have considered the influence of risk perception and loss aversion on farmers' decisions to withdraw from rural homesteads, and even fewer have investigated the role of policy identity. Using fieldwork-collected primary data and a lottery-choice experiment from a reform pilot area of southwestern China, this study aimed to provide a new focus for risk perception and loss aversion in farmers' intention to withdraw from rural homesteads through policy identity. According to our findings, only 45.30 % are willing to withdraw from their homesteads. Farmers typically perceive two to three categories of risks among residence risk, livelihood risk, security risk, and policy risk. Only 29.28 % of respondents report a low level of loss aversion, with the remainder reporting a moderate or high level. More than half demonstrate a high level of policy identity. Most notably, after dealing with endogeneity, risk perception has a negative impact on farmers' intention to withdraw from rural homesteads, whereas loss aversion has a positive impact. Policy identity has a positive influence on farmers' intention, partially mediating the negative path of risk perception and entirely mediating the positive path of loss aversion. Robust concluding remarks advocate for the improvement of farmers' policy identity based on heterogeneous characteristics of risk perception and loss aversion, as well as a more individualized consideration of land withdrawal options.