Land rights in rural China: Facts, fictions and issues

The allocation of property rights is widely recognized to have important implications for resource use and the distribution of household welfare. The introduction of household farming in the early 1980s extended use rights to cultivated land on a fairly egalitarian basis. Over the past two decades, control over allocating farmland has remained in the hands of local leaders. In evaluating China's land tenure system from a policy perspective, the critical question is how effective the system has been in providing households with the necessary incentives to ensure rational land use and investment, while simultaneously helping local communities to meet households' needs. Looking past 2001, how well does the system fit the needs of China's rapidly evolving economy? Our survey work suggests enormous heterogeneity at the village level. In some villages farmers seem to hold relatively long tenures and have the right to select crops, convert land to alternative agricultural uses and rent out land, all of which are typically associated with a private property regime, albeit short of being able to buy or sell the land. In other villages, tenure is shorter and the use of the land is constrained in various ways.