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Research on the association between rural households' livelihood capitals and livelihood strategies has long been of interest in geography, management, economics, ecology and other disciplines. However, the existing micro-empirical studies are mostly small-scale surveys of rural households; there are much fewer large-scale investigations at the national level. Meanwhile, few empirical studies have analyzed the sensitivity of rural households' types of livelihood capitals among different types of villages in China. These findings provide reference for the formulation of policies related to the improvement of rural households' livelihoods in different types of villages.

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Research on the sustainable livelihoods of rural households is of great significance in solving rural poverty and promoting the transfer of rural land management rights, which are necessary for realizing better livelihoods and sustainable development. In this study, we used a partial least squares‐structural equation model to systematically explain the interacting mechanisms of livelihood capital, livelihood strategy, and agricultural land transfer in the mountainous and hilly regions of Sichuan, China, based on survey data from 240 rural households. The results are as follows: (a) land transfer characteristics were negatively affected by farmers' livelihood strategies. The higher the proportion of the nonagricultural labor force/livelihood diversity index, the greater the possibility to roll‐out plots. The lower the proportion of the nonagricultural labor force/livelihood diversity index, the greater the possibility to roll‐in plots. (b) Natural capital was directly and negatively affected by livelihood strategy, and indirectly and positively affected by land transfer. (c) Financial capital insurance was indirectly and positively affected by livelihood strategy. Financial capital insurance had a mediating effect: land transfer not only had a direct negative effect on it but also had an indirect effect through natural capital. (d) Financial capital income was directly positively affected by financial capital insurance, and indirectly negatively affected by land transfer and natural capital. Financial capital income had a mediating effect, and livelihood strategy not only had a direct positive effect on it but also had an indirect positive effect via human capital. (e) Physical capital and human capital were directly positively affected by livelihood strategy. (f) Certain moderating effects were observed. Nonagriculture‐dependent farmers had higher physical capital, greater human capital, higher financial capital income, and more area of roll‐out plots than agriculture‐dependent farmers. This study provides theoretical guidance for the formulation of policies for livelihood improvement and sustainable development.

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