The Research Of Chinese Rural Water Conversancy Infrastructure Construction And Institutional Innovation

Agriculture is the basis of the Chinese national economy, and water is the lifeline of agriculture. The construction of water conversancy infrastructure (WCI) in rural area closely relates to the sustainable development of Chinese agriculture, since high quality WCI is able to improve the product ability of grain and thereby fixing the’three dimensional rural issues’. Agriculture and rural economy in China is currently developing to a new stage, so there are many new problems about water conservancy projects in countryside. For instance, the law, policies, and institutions about rural water conservancy is defective, and there are some problems about the financing system, management, and the safety of drinking water. In addition, the environmental problems and the issues of income and loss that are generating through the construction process of WCI is also important to the local government.Therefore, enhancing the rural WCI, respecting the institutional innovations of WCI development system, and improving the quality and efficiency of WCI will change the present situation of low-efficient resource distribution, huge lose of public welfare, and undeveloped rural infrastructure in China. Moreover, the methods above could also improve the weakness of water conversancy research, consistently enhance the constructing structure of rural infrastructure, and apply the promoting role of rural WCI towards the development of rural economy. In addition, the analysis about the property right of WCI and the research of financing model could provide a practical guide to relating departments.Since the importance of water conversancy towards the economy development of China, the Community Party of China issue the No.1document in2011to announce that developing water conversancy and diminishing water issues closely relates to survival of human beings, development of economy, and enhancement of society. In order to enhance the development of economy in a fast pace in the long term and maintain the sustainable of the society, China needs to accelerate the development of water conversancy to improve its supporting role and to realise the sustainable utilisation of water resource. This also requires the government to add the issue of water conversancy into the position of national strategy.Water conversancy is the most necessary condition of modern agriculture construction, the unchangeable and basic support of economy development, and the undividable security system of environmental protection. It contents three attributes including common, supportive, and strategic. To enhance the development of water conversancy not only influences the development of agriculture but also effects the overall situation of social economy development and the security of water supply, food, economy, and environment. In practise, China has spent4trillion RMB in last10years for the construction of rural water conversancy. However, there are many problems that could not be handled by only increasing investment. Since some designing issues of institution, constitution, and mechanism need to be improved, more research about this field are required.Innovative PointsFirstly, the article provides consultation for a region to make selection about the main supplier of WCI, by combining the chancing theory, the property theory, and the transaction cost theory of institutional economics to analyse the supply chains and transaction cost of the three main suppliers:government, market, and public product community. Secondly, the essay discusses the size limit of institutional sunk cost of infrastructure industry and analyse the best institution of WCI construction. Finally, after analysing the relating property right of supplying institution, the article introduces the logic of selecting supply institution of WCI, and covers the relationship between the government and enterprises in the analysis to discuss the financing model and relating institution of WCI industry including the non-stated-own economy.The Structure of the PaperThe first part introduces the background and meaning of this topic, reviews and concludes the Chinese and foreign relating theories about the development of rural WCI. In addition, it analyses and evaluates the relationship between WCI and rural economy development, and the main supplier of rural WCI. It also lists the innovative points of this article and its insufficient parts. The second part introduces the general theory of WCI by listing the function and attribute of WCI, and analyses the relationship between WCI and national economy development.The third part reviews the main institutional theories which influence the development of WCI, including institution and institution change, transaction activity and transaction cost, and the variability of property, and analyses the supply institution of WCI from the factors of supply institution, demand institution, main supplier, and the principle of supply and price.The forth part evaluates the main reforms and achievements of the construction of Chinese WCI. Moreover, it argues that the plan of WCI, the gap of constructing capital, the problem of financing institutional innovation, and management and quality of construction are the main issues that WCI construction is facing. Although WCI has large demand potential, the lack and low efficiency of supply, the unfair between rural and urban public product supply institution, and the inappropriate financial system of rural public product supply constitution lead to a lack of rural WCI supply. The issues of implicit income and cost and environmental problems are the key factors that disturbing the development of WCI. In addition, there are obstacles from ideology、political constitution, market access, finance model, and protection of rights and interests when private capital intends to enter the infrastructure industry. There are also appearing the phenomena of state owned equity weakening and the loss of state-owned assets in this process. As a result, this part takes micro view to use the case of Pingxiang in Jiangxi province for analysing the situation of WCI development, the action taken by the government, the contemporary issues, and the strategy reply to these issues.The fifth part evaluates the experience of developed country about WCI construction, and concludes the intuitional innovation advantage of USA, Canada, Japan and European country towards infrastructure construction. It also make a conclusion:the idea of infrastructure reform in every country leads the reform style and methods, the different national conditions and different stages of development leads the demand of governmental capital, and the governmental leadership market economy and liberal market economy both respect taking actions to positively attract private capital to enter infrastructure construction.The sixth part advises the suggestions of institutional innovation about WCI institution based on the concept of Chinese WCI innovation. Based on the definition of the concept about institutional innovation of WCI, this part discusses the institutional innovation of property rights mainly about the division of operation right and ownership. In addition, property right institutional reform needs to attract competition system and gradually realise the innovation of market structure, import competitive constitution though service decomposition, and set up appropriate competitive structure in a market with clear mind of property rights. Following with these processes, the relationship between the government and enterprises needs to be redraft, and do research with the capital market and infrastructure construction from technological directions to realise financing innovation from the best institution that allowing non-state-own economy enter infrastructure industry.The seventh part concludes the context and innovative points of the article, and combing the insufficient part of the paper and the unsolved problems during the research to argue the new research direction about the construction of water conversancy infrastructure and institutional innovation.