Green food: The political economy of organic agriculture in China

This dissertation examines the capacity of the Chinese government to use market based policies in response to the ecological crisis in agriculture. Two competing, state sponsored efforts to promote environmentally beneficial agricultural development, through a combination of market incentive and state action commonly referred to as organic certification and marketing, are investigated. An established theory of the Chinese policy making process, fragmented authoritarianism, and new literature on local developmental states, are combined with case studies to explain transformations of organic certification and marketing within the Chinese context. The political economy of rural China is best described as a fragmented entrepreneurial state. State fragments use political authority to gain market advantage as both regulators of and competitors in the socialist market economy. State fragments simultaneously seek to maintain the authority which comes with state identity and to acquire autonomy to pursue their own goals creating a semi-state pluralism which concepts such as civil society or non-governmental organization fail to capture. The fragmented entrepreneurial state has important consequences for the operation of market based policy mechanisms. Entrepreneurial incentive on the part of state institutions helps to overcome some public goods problems. However, the use of political authority to organize production distorts the system. Market incentives fail to reach targets, ecosystem appropriate innovation is stifled, and free rider problems ensue. The demands of the international organic market, which provide the essential economic incentive to the system, exacerbate these problems as international buyers look to state entrepreneurs to provide organization and control. As a result, the balance between market rationality and ecological rationality is lost and market forces lead to negative environmental outcomes. These findings have important implications for environmental policy in China and internationally. As long as political authority and market advantage are fundamentally intertwined in China, policies which use market incentive to promote environmental goals will fail. A broader lesson points to the need for a comparative political economy approach in the design and analysis of international environmental regimes. If market based regimes simply reinforce existing command and control structures they exacerbate the very collective action problems they are designed to resolve.