Social and Behavioral Sciences Commons^™

The Political Economy Of Contract Farming In China's Agrarian Transition, Qian Forrest Zhang

Research Collection School of Social Sciences

How does rural China’s political economy determine the motivations and constraints that drive small farmers and agribusiness companies into contract farming and shape its practice and impact? This paper identifies three distinctive features of contract farming in China—varied impact on rural inequality, unstable contractual relations, and lack of competitiveness with other alternatives—and proposes tentative explanations with three features in rural China’s political economy: strong collective institutions, active state support for agriculture, and strong domestic markets. The recent turn in China’s agrarian transition toward vertical integration of agriculture with industries is, however, undermining these conditions and may move China toward more …