Land, Labour, and Scale: Increasing Agricultural Productivity in Rural China

Abstract

Released at the beginning of each calendar year, the annual Central Document No. 1 signals the Chinese central government’s key strategic objectives for stimulating the nation’s countryside. The volumes, rich in optimism about rural China’s potential, consistently express an urgent priority: scaling up agriculture through market-oriented reforms.1 In doing so, they underscore the central government’s doubts about whether the country’s small-scale farming, institutionalised under the Household Responsibility System (HRS), can satisfy its changing agricultural demands while forging a path of food self-sufficiency. This essay will argue that shifting away from small-scale landholding is critical to increased productivity. However, it will posit that the gulf between legal and perceived land security limits land rental behaviours among farmers, which market-oriented reforms broadly fail to address. Policies must, therefore, be sympathetic to farmers’ perception of land tenure to achieve optimal growth. 

In arguing for this position, the essay will begin by outlining the history of land administration in rural China and its current system of organisation before turning to the advantages offered by land rental markets (LRMs). It will then explore how several land tenure practices, including land abandonment and the prevalence of oral contracts, support the claim that farmers are resistant to renting-out—limiting the effectiveness of other reforms. Informal rental practices that promote moderate-scale farming offer a solution to this problem by maintaining perceived land security while addressing other productivity inefficiencies. Overall, the essay will conclude that while LRMs will improve agricultural productivity, China’s government must address the abovementioned perceptions to maximise this effect.