1
China’s rural structure
People’s Communes
People’s Communes were communes in China’s rural villages from 1958 to 1982.
Communal management committees were set up in rural villages and were responsible for
production, construction, finance, food provision, trade, civil administration, culture, health,
law and order, militiamen and mediation of civil disputes. On joining a commune, a farmer
handed over all public properties and private land to the commune.
Only a small number of
poultry and livestock could be kept as one’s own. A wage system was introduced. A fixed
wage was paid each month according to one’s wage scale.
All commune members were
allocated free food provision according to family size.
Contract responsibility system linked to family production (contract system)
Under the contract system, rural households are responsible for production.
Farming households enter into contracts with the state. The contracts do not specify
output, input or production target. Farming households make their own decisions on
production activities. Out of their production income, agricultural tax is paid to the
state.
Contract fees, gratuities (to be used for public investment), public welfare fees
and management charges etc. are paid to the collective. The rest is to be kept by the
contract undertaker.
In popular slogan: “pay what is due to the state, submit what is
due to the collective and keep what is left to oneself”.
Under the contract system, farmers have increased power of decision-making
in production management. The contract system is adaptable to the productivity
level of different rural villages. It overcomes the drawbacks of over-centralised
management and equalitarianism in allocation.
2
If you were a Chinese farmer …
1. Of the two systems mentioned above, which one gives you more incentive in
farming?
Why?
2. Which of the above two systems gives more stability to your life?
Why?
3
By the end of 1994, 98% of rural village groups
throughout China practiced family contract management.
The area under cultivation covered by family contract
management was 93.3% of the total. As such, the
mechanism of family contracts has become the most
basic form of agricultural production in rural villages.
With reform and continuous development of agricultural
production and of the rural economy, the income level of farmers escalated
greatly. In 1978, the per capita net income of farmers was 133.6 yuan.
By 1998, it increased to 2,162 yuan.
Rural reform brought growth in production and improvement in food supply. The
urban and rural population became better off.
Between 1998 and 1978, food consumption
expenditure doubled. For example, oil consumption rose 2.1 times, meat 1.3 times, poultry
and egg 4.1 times and aquatic products 3.4 times.
Other living expenses also grew at great speed.
On
average, every 100 rural households owned 96.16 TV sets,
representing a growth rate of 7.2 times compared to 1985. They
owned 32 recording machines and 21.9 washing machines,
representing a growth of 6.5 and 11 times respectively as compared
to 1985.
Electric refrigerators, tape recorders, cameras, air
conditioners etc. have become part of ordinary household features.
Reference:
4
Assuming you were born into a Chinese farming family,
 with the implementation of the contract system, you family was
allocated a small area of land for cultivation, but it was not big enough
to support the family and give every member work.

your family sold the surplus food and had some cash in hand.
You have learned of the fast development in coastal cities and the large demand
for workers for their labour intensive industries.
3. Having considered the above factors, what would you be thinking?
4. If a large number of farmers in China makes the same kind of decision as you do
at the same time, what kind of problems will arise?
5
5. From what people say, you can tell who they are.
Fill in the blanks on the right
with suitable letters.
A. Farmers of
People’s
Communes
B. Farmers under
the contract
system
C. Labourers at
work
a.
What is the use of working hard? In the end, we all eat from the big
bowl. The land belongs to the state. Farm produce belongs to the
state. I just work for the state. Profit or no profit. Not my business.
b.
After turning over the required quantity of farm produce to the state
each year, the rest can be sold on the free market. In this way, I earn
more. The harder I work, the more the rewards.
c.
I work in a factory in Pudong. I did not go home for the Spring
Festival because work was demanding in the factory, and it was
difficult to purchase train tickets.
d.
In the past, everything was planned by the commune. Work done for
irrigation was counted as workpoints. Nowadays, I grow corn. The
harvest is not bad, but I have no time to do irrigation work. In any
case, major irrigation projects cannot be achieved by us mere farmers.
And yet, if you don’t care and I don’t care, we will be the ones to
suffer in the end.