The Formation And Choice Of Agriculture Land Property Rights

The structure of agriculture land property rights was an important institutional arrangement since the ancient times which has significantly influenced China’s economic and social development, and its history is a centralization and decentralization process following the principle of efficiency between property owners from upper and lower level. On the approach of Natural Resources Hierarchical Theory,this paper aims to explain the formation and development of China’s agriculture land property rights, to explore an optimization path for China’s current one in an angle of efficiency, especially the implementation process of its authorization and distribution process between property owners from upper and lower level, and to find out the formation and border of the structure of high efficient farmland property rights.Firstly, this paper reviews Hierarchical Theory, and then presents its correlation with Chinese culture and history by illustrating its instruction to our China and its application in fields of water rights, land rights, forest rights, mineral rights and so on, which proving that it is a suitable theory to explain our country’s agriculture land property rights issues.Based on System Hierarchical Conceptual Model and the frontier research result of western property rights economics, this paper analyzes the reason and path of agriculture land property rights hierarchy’s formation and its efficiency generation mechanism. Then revises the above mentioned model to a Conceptual Model of Agriculture Land Property Rights Hierarchy to suit China’s reality, and explains this new model’s foundation basis,operation mechanism and application range.Secondly, with the tool of Conceptual Model of Agriculture Land Property Rights Hierarchy, this paper studies the evolution, authorization, and distribution process as well as its tendency of China’s agriculture land property rights by comparing China’s two thousand years feudal society and contemporary China from a perspective of macro view.Logical deduction and case study are used in this thesis to probe into roots of contemporary China’s agriculture land property rights to discuss the motivation and economic impact of the structure change. Through questionnaire survey, cases study and field investigation, this paper studies on the phenomenon of contemporary China’s land property rights centralization and decentralization during property rights transaction.Besides, different levels of agriculture land property owners and government departments were visited and interviewed, including functional departments in Guangdong, such as Foshan, Zhaoqing, Yunfu, as well as some county and town governments and collective organizations. Field investigation was made in some of the large farmers and agricultural companies. By presenting an in-depth case study and econometric analysis on the agriculture land property rights change of Dawang Overseas Chinese Farm of Guangdong from 1958 to 2001, this paper interprets the motivation and performance of China’s land property rights hierarchical change, and reveals the change regularity of land property rights structure from the perspective of transaction cost economics,.Based on theoretical research and case studies, this paper draws the following conclusions:1. The structure of Chinese agriculture land is hierarchical, because the main body of agricultural property rights is multi-level and the top body of property rights always influence on the lower. It is the multi-level construction of farming land property rights that gives a full play to allocate resources hierarchically and to bring into play the role of the market mechanisms, in order to make the desires come true which maximize the pursuit of interests and enhance efficiency of farming land output.2. The Hierarchical Theory is suitable to explain the changes of agriculture property rights and the conceptual models of farming land hierarchy in China. It has the ability to explain the changes of land property rights and it is valuable for farming land property rights conversion in current Chinese situation.3. Three factors work on the formation of China’s agriculture land property rights hierarchy: goal of system, system environment and property rights efficiency. The first one is influenced by political and economic preference of property rights makers; the second includes natural environment like geological conditions, disasters and diseases as well as social humanistic environment such as custom and perceptions; the last one,property rights efficiency, is about the system itself, such as the transaction cost and the performance bonuses for which the system running is required. Changes occur in any of these three factors will lead to variety.4. China’s agriculture land property rights hierarchy is formed during the process of authorization and distribution. Against the policy backdrop of separation of ownership,contractual right and operation right, agriculture land transaction is a process of operation right’s authorization and distribution among land owners of different levels, and the choice of surplus property rights is the core.5. It is an efficient property right structure model that the upper level works as a service center by centralized some certain property rights and the lower focuses on decentralized management or operation. The prerequisite of establishing this structure is the hypothesis of rational person and pure economic factors. To maintain this structure, the comprehensive benefit of it shall equals to its transaction costs. The key to establish this structure is allocating enough surplus property rights, which lead to high productivity, to lower level.Based on the above research, this paper points out three recommendations for reforming system of farming land property right in China: 1. Use the Hierarchical Theory to direct a new round of the integration of farming land property rights, 2. During the farming land conversion, pay attention to the establishment of centralized service distribution structure of land property rights. 3. During the process of agricultural production, promote the centralized service distribution pattern in agricultural production process.