General Equilibrium Research On Diversity Of China's Rural Land System

The general equilibrium can give more general explanations on rural land system than partial equilibrium, especially on the institutional innovations which take happen after the household undertaking responsibility system of China' rural land system. Because of the system's publicity, general equilibrium can not only explain all the existing system innovation phenomena, but also explore the potential variables. The general equilibrium model performs some forecast function. The article depicts economy system of rural land system arrangement and choice completely by this neoclassical general equilibrium model of non-linear programming, concludes multi-equilibrium, reflects the influence of different market trades and resultants on the system, and explains the institutional diversity with the restrict conditions.The article analyses the relationship among division, trade cost and system. Division is the reason for trade cost and system. Trade cost and the level of specialization decide the division pattern, and equilibrium division pattern produce the system selection. It manifests the features of extra -marginal analysis. Based on that, it demonstrates the efficient system's effect on economy efficiency by the neoclassical general equilibrium model. The conclusion explains the advantages and disadvantages of system selection, and the effective system promotes the economy development. The system selection is the rational choice, and it is the optimization of economy utility with the restrict conditions.The article studies the mechanism of system optimum choice, builds the diversity of rural land system choice model, and concludes that self-sufficient system reaches general equilibrium when trade efficiency is not good; wage system reaches general equilibrium when labor market trade efficiency is good; and tenancy system reaches general equilibrium when land-tenancy market trade efficiency is good. The labor market and land-tenancy market trade efficiency together decide the situation of the sharecropping system. From the point of general equilibrium, the conclusion extends Steven. N. Cheung's share tenancy theory about partial equilibrium which means trade cost decide the sharecropping system; formalizes Barzel's general equilibrium about the sharecropping system. The symbolic conclusion explains current different local rural land system innovation phenomena perfectly. Those innovations are local farmers' rational choices on their conditions. The conclusion also explains rural land economy of scale, which means the scale of rural land is irrelevant of the economy. Not the scale of rural land, but the promotion of trade efficiency of distribution is the reason for the economy development. The conclusion can distinguish system-caused reform with system-forced reform. The incompletion of two or more element markets causes farmers are exploited by others or themselves, this is the confine condition of system-forced system reform. The conclusion also explains the positive correlativity between excess land centralization and land reform.Furthermore, the article studies the effect mechanism of system relevancy on system selection, builds the general equilibrium model of rural land system relevancy, and concludes that the relevancy of system generate rent, this rent expands the system aggregate, releases the restrict condition of stimulant contract, promotes the whole system Pareto and brings diversity of rural land system. Besides, the linkage of system keeps some inefficient systems. For the whole society, we just get Pareto-inferior and all the systems are in the chain of a whole system and depend on each other. This conclusion makes sense of a system innovation phenomenon or organization-rebuilding called "contract after rent". The essence of it is that to bind commodity contract with element contract, save the interior trade cost, increases the economy efficiency.The article also studies the effect mechanism of system complementariness on system selection, builds the general equilibrium model of rural land system complementariness, and concludes that both the balance of complementarity of the system and specialization economy and the balance of trade cost and specialization economy together decide whether system innovation or not. When the trade efficiency is good and specialization economy predominates complementary economy, system innovation occurs. When the systems take on strong complementarity, they fall into a low-level trap; all the systems are in the chain of a whole system and depend on each other. This conclusion also explains the appearance of rural land stock innovation. It is most believed that the economy of scale causes the rural land stock innovation, but it is difficult to get support by demonstration. While the system complementarity explain the appearance of rural land stock innovation is caused by the limitation of land-levy, and it is wildly supported by demonstration. The model also explains the Needham Paradox synthetically.The resultants of different market trades efficiency decides the choice of system, the complementarities and the linkage of the system expands the choice aggregate of system, unfolds the institutional diversity.