Institutional innovation and policy support to facilitate small‐scale farming transformation in China

Abstract

While the Asian food economy has been experiencing significant transitions, it is widely believed that little transformation has occurred in farm land operation. However, the recent rapid emergence of middle and large‐size farms in many regions of China is striking, as is the increase in size of operational units. The overall goal of this article is to understand small‐scale farm transformation in China based on a unique dataset surveyed in Northeast and North China. The results show that the institutional innovation through establishing land transfer service centers to promote land rental markets and reduce transaction costs, policy support to speed up land consolidation, and farm mechanization services are major driving forces in the recent evolution of China's farm operations. The article concludes with policy implications on small‐scale farming transformation in China and the rest of world and identifies research issues for further study.

China’s 40 years of agricultural development and reform

“…As more households began to work full-time off the farm, they also began to rent out their land (Gao et al 2012). Those who stayed are the ones renting this land, which is behind a steady increase in farm size and increasing pressure to mechanise Huang and Ding 2016;Wang et al 2016). …”

“…The major efforts in land use have been on stabilising the HRS in the late 1990s (Ji and Huang 2013) and developing institutional arrangements (such as township land rights transfers) to facilitate land consolidation since the mid-2000s (Huang and Ding 2016). Stabilising farmers' control and income from land contract rights is important because it provides incentives for farmers to invest in agriculture and land and stimulates land transfer among farmers, increasing farm size, which improves agricultural efficiency, productivity and incomes (Gao et al 2012;Huang and Ji 2012;Jin and Deininger 2009).…”

“…Stabilising farmers' control and income from land contract rights is important because it provides incentives for farmers to invest in agriculture and land and stimulates land transfer among farmers, increasing farm size, which improves agricultural efficiency, productivity and incomes (Gao et al 2012;Huang and Ji 2012;Jin and Deininger 2009). Huang and Ding (2016) show that one-third of the land contracted by households through the HRS was transferred among farmers.…”

Mechanisation Outsourcing and Agricultural Productivity for Small Farms: Implications for Rural Land Reform in China

“…The average size of Chinese household farms is less than 1 ha (just less than 40 per cent of the global average for small farms), and, moreover, until 2004, was in continual decline (Huang and Ding 2016a). While a number of exceptionally small farms are able to achieve high productivity, the majority rely on intensive use of self-employed labour as a substitute for capital.…”

“…A more pressing problem is that falling average farm size (in terms of land area operated) has restricted farmers utilising advanced technologies (such as minimumtillage and no-tillage methods) that are embodied in large plant and machinery (Sheng and Chancellor 2017). Estimates based on annual rural household surveys by the Chinese Ministry of Agriculture show that the average size of farms in China declined from 0.73 hectare in the early 1980s to 0.53 ha in 2003(NBS 1985-2005Huang and Ding 2016a). As a consequence, growth in selective crop productivity fell between 2005 and 2014: to 70 per cent for wheat, 73 per cent for maize and 51 per cent for barley of the long-term growth rate since 1961 (FAO 2017).…”