Effects of Human–Elephant Conflict and Wildlife Damage Compensation on Farm Households’ Farmland Transfer-Out and Abandonment

In areas with frequent wildlife activity, coordinating biodiversity conservation with agricultural production is a critical issue for achieving agricultural sustainability. This study uses farm household survey data collected in 2022 from Asian elephant distribution areas in Yunnan Province, China. It systematically evaluates the effects of Human–Elephant Conflict (HEC) and the wildlife damage compensation policy on farm households’ farmland use behavior. Focusing on farmland adjustment behavior under the context of biodiversity conservation, we develop an analytical framework of “HEC–policy intervention–farm household farmland use behavior.” Using survey data from 1276 farm households, we examine the effects of HEC on farmland transfer-out and farmland abandonment. We also analyze the moderating role of the wildlife damage compensation policy. In addition, we explore the heterogeneity between areas inside and outside nature reserves. The results show that: (1) HEC significantly increase the likelihood of farmland transfer-out and farmland abandonment among farm households; (2) the wildlife damage compensation policy partially mitigates the positive effects of HEC on farmland transfer-out and farmland abandonment; and (3) the effects of HEC on farmland transfer-out and farmland abandonment are more pronounced for farm households outside nature reserves. The wildlife damage compensation policy shows a stronger inhibitory effect on farmland transfer-out inside nature reserves. In contrast, it has a stronger inhibitory effect on farmland abandonment outside nature reserves. From the perspective of farmland use, this study reveals how HEC and policy intervention influence farm households’ farmland allocation behavior. It also provides empirical evidence for improving wildlife damage compensation mechanisms. In addition, the findings help promote synergy between agricultural sustainability and biodiversity conservation.