Agricultural System Change Research

Although China has a booming industrialization, a progressively urban modernization and remains the new shining star of the world economy continuously for more than 20 years, China's agriculture is still basically a traditional type or is still wandering before the gate of modernization. More than 80% of total Chinese population is still living in the underdeveloped countryside far from modern civilization; millions of countryside laborers are still chained to the intersected farms or swarm into the cities to do some dirty and tiring jobs, thus becoming the so-called edge-persons. The tri-farming problem (agriculture, countryside and farmers) has become China's biggest headache and obstacle to modernization. If this problem does not have a perfect solution, China can't be called a modernized country in any sense. So there is great significance to study the tri-farming problem.China's reform originated from the countryside. Till now Chinese greatest reform is still the reform of rural economic system in early 1980s, i.e. the household contracting system's replacing of the collective system of agricultural production. The household contracting system excited the farmers' enthusiasm for production and greatly promoted agricultural production and farmers' income, thus released the productive forces in the countryside. Most areas solved the problem of food and clothing and gained new development, which is a spectacular achievement in the world. It is of great significance to summarize the process and sublime it. The changes of Chinese agricultural system correspond to what the new institutional economists said, "institution is important", i.e. institution plays a very important role in economic development. New institutional economics rejects the practice that classical and new classical economics regard the factors of institution asestablished or mislay it beyond their scope of analysis. In this way, new institutional economics develops the tradition of old institutional economics and introduces the factors of institution such as property rights, transaction cost, state and ideology into analysis, which approaches closer to the real world than the classical and new classical economics. Furthermore, it establishes a set of analytical framework of its own logic and provides a very persuasive analytical tool for the changes of economic institutional changes. The analytical framework of this paper is just mainly established on the theory and analytical tools of new institutional economics.In some sense, Marxist economics is also a kind of institutional economics. The ultimate point of Marxist economics lies in the fact that it reflects the basic economic rule that productive forces determine production relations (or institution), and production relations counteract productive forces. This rule works at any period of history. Marxist economics is the philosophical basis and general methodology of this paper. The gist of the paper is to set up the argumentation that household operating system is the long-term and certain choice of agricultural production institution. This is the general clue of the paper, around which it makes such analysis as the following:Firstly, the paper reviews the agricultural cooperative theory of Marxist economics, which is regarded as the theoretical source of Chinese agricultural institutional changes in the 1950s. But the research shows that the two doesn't match each other. Secondly, the paper applies the relative theories of new institutional economics comprehensively such as the theory of property rights, the theory of transaction cost,the theory of public choice and the theory of institutional changes. The application of the theory of property rights and the collective action theory of the theory of public choice is to analyze and explain why the collective system of agricultural production lacks institutional efficiency while household operating system has higher efficiency, the application of the theory of transaction cost to explai...