Market reforms in the countryside

H2 History - syllabus 9174, 2027

What this lesson teaches

  • I can judge which factors did most to transform the economies of Japan and China over time.

    Syllabus 9174, Paper 1, Theme II, Learning Outcomes. evaluate the factors that contributed to the economic transformation of Japan and China over time

Make a guess

In late 1978 farmers in Xiaogang village secretly divided their collective land among households. What do you think happened next?

  1. They were punished, and the communes stayed in place.
  2. The central government had ordered it in a detailed plan.
  3. The idea spread, and farm output and incomes rose fast.
Show the answer

The idea spread, and farm output and incomes rose fast.

Under the Household Responsibility System, families could sell any surplus after their quota, so effort finally paid.

Letting farm families sell their surplus made effort pay. Farm output and rural incomes rose fast in the early 1980s.

Reform began in the countryside. In late 1978 farmers in Xiaogang village, Anhui, secretly divided their collective land among households. The idea spread.

Under the Household Responsibility System, families leased land and delivered a fixed quota to the state. They could sell any surplus on the market. The state also raised the prices it paid for crops in 1979. By the mid-1980s the communes had been dissolved.

Output rose fast because effort now paid. Grain production rose from about 305 million tonnes in 1978 to about 407 million tonnes in 1984. Rural incomes more than doubled.

Township and village enterprises (TVEs) grew rapidly. Owned by local governments, they made consumer goods and building materials. TVE jobs rose from about 28 million in 1978 to about 135 million in 1996.

Rural reform freed workers and savings for industry. Its success also built support for wider reform.

Xiaogang
Late 1978: farmers divide land.
Grain output
About 305 to 407 million tonnes, 1978-1984.
TVEs
About 135 million jobs by 1996.

Real examples to use

Higher grain prices, 1979

The state raised the price it paid for grain by about a fifth and paid more for sales above the quota, giving farmers a reason to grow more.

Communes dissolved, by 1984

Townships replaced the communes as the Household Responsibility System spread across the country.

Worked example: Explaining rural growth

Why did farm output rise so fast?

  1. Incentive: families kept what they produced above the quota.
  2. Prices: the state paid more for crops.
  3. Industry: TVEs gave rural workers new jobs.
  4. Spread: local success encouraged national adoption.

Watch out for this

Rural reform was planned in detail by the central government.

It began with farmers' own initiative in places such as Xiaogang. The state then approved and spread it after it worked.

Check your understanding

What did the Household Responsibility System allow?

  1. Families leased land, met a quota and sold their surplus.
  2. Communes were made larger and better equipped.
  3. Families bought land outright as private property they could sell.
Show the answer

Families leased land, met a quota and sold their surplus.

Right. Effort now paid.

The Wise Otter

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