Honolulu • Hong Kong • Beijing • Singapore Published by Enrich Professional Publishing, Inc Suite 208 Davies Pacific Center 841 Bishop Street Honolulu, HI, 96813 Website: www.enrichprofessional.com A Member of Enrich Culture Group Limited Hong Kong Head Office: 11/F, Benson Tower, 74 Hung To Road, Kwun Tong, Kowloon, Hong Kong, China China Office: Rm 309, Building A, Central Valley, 16 Haidian Middle Street, Haidian District, Beijing, China Singapore Office: 16L, Enterprise Road, Singapore 627660 Chinese original edition © 2013 China Renmin University Press By Lu Yilong English edition © 2015 by Enrich Professional Publishing, Inc With the title Rural Development in China: The Rise of Innovative Institutions and Markets Volume Translated by Yu Lun Edited by Glenn Griffith, Phoebe Poon, and Yu Lun All rights reserved This book, or parts thereof, may not be reproduced in any form or by any means, electronic or mechanical, including photocopying, recording or any information storage and retrieval system now known or to be invented, without written permission from the Publisher 978-1-62320-082-4 ISBN (Hardback) ISBN (pdf) 978-1-62320-083-1 This publication is designed to provide accurate and authoritative information in regard to the subject matter covered It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service If legal advice or other expert assistance is required, the services of a competent professional person should be sought Enrich Professional Publishing is an independent globally-minded publisher focusing on the economic and financial developments that have revolutionized New China We aim to serve the needs of advanced degree students, researchers, and business professionals who are looking for authoritative, accurate, and engaging information on China Contents Preface vii Chapter Institutional Innovations and Rural Market Development 1 Chapter Institutional Supply, Demands on Institutions, 21 and China’s Rural Development Chapter Reform of the Urban-Rural Dual Structure 43 and China’s Rural Development Chapter Farmland Expropriation and the Reform 91 of the Rural Land System Notes 111 Bibliography 115 Index 123 Preface Looking at China’s implementation of the Reform and Opening Up policy over the past 30 years, the following observations can be made: reform is the only way to ensure steady and stable development Reform, in essence, is institutional innovation through which society and the economy embrace greater progress and productivity as well as get rid of ineffective institutional arrangements Therefore, in a sense, institutional innovation can be counted as a productive force, for its process encompasses achievements from various fields, including philosophy, social sciences, as well as advanced economic and social management Originating in rural areas, the Reform and Opening Up policy made happen the first leap in China’s economic and social development: China has got rid of destitution and begun striding towards moderate prosperity In the meantime, however, sluggish rural development remains a big problem The second leap would require the development of China’s rural areas, for they are the bottleneck of national development, or in marketing terms, the hole of the “leaky bucket,” while at the same time being the solid foundation of all socioeconomic progress Then, how is it possible to realize the second leap in rural China? They key lies very likely in institutional innovation: changing the impeding institutional arrangements and establishing institutions that could stimulate development This book will discuss how rural China, in this new era, should develop in the respects of institutions and market, specifically what institutional factors are constraining the development of the rural market and the “three rurals” of agriculture, villages, and farmers, and what kind of institutional innovations and institutional arrangements could bring improvements The development of rural China has long been the concern of Chinese sociologists: Yan Yangchu raised the idea of village construction movement, Wu Wenzao initiated community studies, Fei Xiaotong proposed the developmental model of “leaving the land but not the village,” the approach of constructing small towns, and the theory of coordinated regional development, and Philip C C Huang (Huang Zongzhi) developed the idea of “the third way” of rural development This book chooses to discuss China’s rural development from the perspectives of institutions and market development mainly because of two reasons First, institutions are a comprehensive variable that shows clearly the relationships among institutions, social activities, and development, for institutions combine factors of all fields from the economic and political to the social and cultural This suits the research of rural development, which is a complex issue itself, perfectly Second, rural development depends on economic progress, whose key is the development of the market against the backdrop of marketization and globalization Effective vii Preface leveraging of the market system would not only drive the development of the rural economy but also help solve problems of the “three rurals.” Although not almighty, the market has its effect in promoting development, and neglecting this “invisible hand” would gravely discount the efficiency of socioeconomic development G William Skinner has conducted research on the relationship between the marketing system and social development in rural China, and Justin Yifu Lin makes developing rural markets the key of his rural reconstruction theory In the field of institutional analysis, the neoinstitutional school has developed plenty of models Borrowing the achievements of these past studies, this book takes a sociological perspective and uses empirical studies to discuss the interrelations and trends in China’s institutional changes, market development, and rural development In terms of empirical studies, this book adopts the China General Social Survey (CGSS) and uses its data for analyses of the household registration system, the urban-rural structure, farmland expropriation, farmers’ actions of “braving the market,” market awareness, and the use of rural land Also included are analyses of field surveys on rural market development in Xiaogang Village, Anhui Province; Dingzhou, Hebei Province; and suburban Beijing The above studies are used to figure out the status quo and problems in rural China and its market development as well as investigate how these problems are related to institutional arrangements This book is divided into three volumes: • Volume is tackles institutional issues in China’s rural development, covering institutional innovation, rural reconstruction, the household registration system, the urban-rural structure, and the rural land system • Volume focuses on specific issues in rural market development, such as: government-induced institutional innovations; emerging factor markets; farmers’ “braving the market”; farmers’ market awareness; farmers’ uses of rural land; rural fairs; and the cultivation of entrepreneurial talent in rural areas • Volume discusses the developmental issues of rural China from a historical lens This volume contains analyses of China’s 60 years of rural development; changes in the Chinese rural class structure and hierarchy; dilemmas in post-earthbound China; and the recent progress and future path of China’s rural development The theoretical discussions and explanations in this book are based on empirical studies The following ideas may require further improvement, but they are based on the author’s understanding of the macro- and micro-experience of rural development in China: reforms towards a “unitary system” for urban and rural institutions; induced institutional innovations; farmers’ “braving the market”; “post-earthbound China”; and diverse paths towards urbanization and rural development viii Chapter Institutional Innovations and Rural Market Development ... research on the relationship between the marketing system and social development in rural China, and Justin Yifu Lin makes developing rural markets the key of his rural reconstruction theory In the field... analyses of China s 60 years of rural development; changes in the Chinese rural class structure and hierarchy; dilemmas in post-earthbound China; and the recent progress and future path of China s rural. .. rapid development of rural product markets and the booming of the rural economy Meanwhile, land markets and labor markets started joining product markets to appear in rural areas Rural factor markets