The governance of farmer cooperatives in China is addressed regarding democratic decision-making procedures, participation in decision making, member exit, and profit allocation. Empirical results from a survey of fruit and vegetable cooperatives in the Zhejiang province (China) indicate that the distribution of ownership rights, decision rights, and income rights in a farmer cooperative is quite skewed towards a small proportion of members. Several governance practices by cooperatives are not in line with the requirements specified by the Law.
Purpose
During the past four decades, agriculture and rural development in China has scored a great progress. Organization institution in agriculture is one of the domains with drastic innovations. The purpose of this paper is to map the emergence and evolution of various agricultural organizations in China since 1978. Development status and the trend of agricultural organization system are analyzed. Further, the role of farmer cooperatives is discussed.
Design/methodology/approach
Data used in the paper are mainly from statistical yearbooks and documents published by the government including Ministry of Agriculture and Bureau of Industry and Commercial. Both descriptive and deductive analyses are adopted to achieve different analytical purposes.
Findings
The vast small-farm sector, co-existence of various types of organizations, and innovation of other organizations will continue and sustain for a long-time period in China. Despite the fast development of modern farmers and various organizations, it is important that traditional farmers participate effectively in modern agriculture. Farmers act collectively via a cooperative in a desirable way, which determines the central position of farmer cooperatives in the agricultural organization system.
Research limitations/implications
This paper is a qualitative analysis on agricultural organizations in China, yet no quantitative estimation regarding the comparison of various organizations is conducted due to insufficient data.
Originality/value
This paper fills the gap of a comprehensive review of the emergence, development status, and trend of agricultural organizations in China.
This paper conducts an exploratory analysis on the role of social capital in influencing both economic and social performance of farmer cooperatives based on a sample of 156 farmers from 54 vegetable cooperatives in China’s Hebei and Zhejiang provinces. Social capital is distinguished into bonding and bridging dimensions, with the former referring to the internal aspect of social capital and the latter the external “Guanxi” (meaning relationship) possessed by core members. The statistical results display that specific dimensions of social capital may not deliver the benefits expected by cooperative practitioners and academics. Both positive and negative effects of social capital on performances of farmer cooperatives are observed. To be specific, bonding social capital is positively associated with common members’ economic benefits. Bridging social capital generates beneficial outcomes for the financial and social performances of cooperatives, while exhibiting negative influence on common members’ income increase because of member heterogeneity.
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