IDEAS home Printed from https://ideas.repec.org/p/cdl/issres/qt4zc171bm.html
   My bibliography  Save this paper

China's Rural Enterprises: Effects of Agriculture, Surplus Labor, and Human Capital

Author

Listed:
  • Peng, Yusheng

Abstract

Rural industry is the most dynamic sector in China. I argue that rural industrialization is funded by agricultural accumulation, driven by surplus labor, and sustained by human capital. Rural reforms since 1978 have allowed Chinese peasants to retain a larger share of agricultural surplus to be transferred into rural industries. Rural surplus labor and shortage of farmland drive rural industrialization by the dynamic of extensive growth. Education is crucial for rural industrialization because market competition raises returns to human capital and industries need schooling more than does agriculture. 1991 data of 1,903 counties show that the top 10% of the counties produced over half of the total output by rural enterprises whereas the bottom 50% contributed little. Regression analyses confirm the above argument and find that education is the strongest predictor of rural industrial development.

Suggested Citation

  • Peng, Yusheng, 1995. "China's Rural Enterprises: Effects of Agriculture, Surplus Labor, and Human Capital," Institute for Social Science Research, Working Paper Series qt4zc171bm, Institute for Social Science Research, UCLA.
    • Handle: RePEc:cdl:issres:qt4zc171bm
    as

    Download full text from publisher

    File URL: https://www.escholarship.org/uc/item/4zc171bm.pdf;origin=repeccitec
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Fleisher, Belton M. & Liu, Yunhua & Li, Hongyi, 1994. "Financial intermediation, inflation, and capital formation in rural China," China Economic Review, Elsevier, vol. 5(1), pages 101-115.
    2. Knight, John & Song, Lina, 1993. "The Spatial Contribution to Income Inequality in Rural China," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 17(2), pages 195-213, June.
    3. Glenn Firebaugh & Jack P. Gibbs, 1986. "Using Ratio Variables to Control for Population Size," Sociological Methods & Research, , vol. 15(1-2), pages 101-117, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zai Liang & Yiu Por Chen & Yanmin Gu, 2002. "Rural Industrialisation and Internal Migration in China," Urban Studies, Urban Studies Journal Limited, vol. 39(12), pages 2175-2187, November.
    2. Ross, Michael L. & Werker, Eric, 2024. "Diversification in resource-rich Africa, 1999–2019," Resources Policy, Elsevier, vol. 88(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Aying Liu & Shujie Yao & Zongyi Zhang, 1999. "Economic Growth and Structural Changes in Employment and Investments in China, 1985–94," Economic Change and Restructuring, Springer, vol. 32(3), pages 171-190, October.
    2. Shujie Yao & Liwei Zhu, 1998. "Understanding Income Inequality in China: A Multi-Angle Perspective," Economic Change and Restructuring, Springer, vol. 31(2), pages 133-150, May.
    3. Jalan, Jyotsna & Ravallion, Martin, 1998. "Are there dynamic gains from a poor-area development program?," Journal of Public Economics, Elsevier, vol. 67(1), pages 65-85, January.
    4. Máximo Torero & Javier Escobal, 2000. "Does Geography Explain Differences in Economic Growth in Peru?," Research Department Publications 3103, Inter-American Development Bank, Research Department.
    5. Dwayne Benjamin & Loren Brandt & Paul Glewwe & Guo Li, 2002. "Markets, Human Capital and Inequality: Evidence from Rural China," International Economic Association Series, in: Richard B. Freeman (ed.), Inequality Around the World, chapter 5, pages 87-127, Palgrave Macmillan.
    6. Emran,M. Shahe & Sun,Yan - GSP05, 2015. "Are the children of uneducated farmers doubly disadvantaged ? farm, nonfarm and intergenerational educational mobility in rural China," Policy Research Working Paper Series 7459, The World Bank.
    7. Ravallion, Martin & Shaohua Chen, 1998. "When economic reform is faster than statistical reform - measuring and explaining inequality in rural China," Policy Research Working Paper Series 1902, The World Bank.
    8. Hrushikesh Mallick & Mantu Kumar Mahalik & Hemachandra Padhan, 2020. "Does globalization exacerbate income inequality in two largest emerging economies? The role of FDI and remittances inflows," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 67(4), pages 443-480, December.
    9. Zhu, Nong & Luo, Xubei, 2006. "Nonfarm activity and rural income inequality : a case study of two provinces in China," Policy Research Working Paper Series 3811, The World Bank.
    10. Aart Kraay, 2000. "Household Saving in China," The World Bank Economic Review, World Bank, vol. 14(3), pages 545-570, September.
    11. Nong Zhu & Xubei Luo, 2014. "The Impact of migration on rural poverty and inequality: a case study in China," CIRANO Working Papers 2014s-08, CIRANO.
    12. Cheng, Yuk-shing, 1996. "A decomposition analysis of income inequality of Chinese rural households," China Economic Review, Elsevier, vol. 7(2), pages 155-167.
    13. Yusheng Peng & Lynne G. Zucker & Michael R. Darby, 1997. "Chinese Rural Industrial Productivity and Urban Spillovers," NBER Working Papers 6202, National Bureau of Economic Research, Inc.
    14. Lu Ming & Zhao Chen & Yongqin Wang & Yan Zhang & Yuan Zhang & Changyuan Luo, 2013. "China’s Economic Development," Books, Edward Elgar Publishing, number 14502.
    15. de Janvry, Alain & Sadoulet, Elisabeth & Zhu, Nong, 2005. "The Role of Non-Farm Incomes in Reducing Rural Poverty and Inequality in China," CUDARE Working Papers 25043, University of California, Berkeley, Department of Agricultural and Resource Economics.
    16. Wan, Guang Hua, 2001. "Changes in regional inequality in rural China: decomposing the Gini index by income sources," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 45(3), pages 1-21.
    17. Zhenhai Xiang & Pengfei Ban & Qifeng Yuan, 2020. "Measurement of the Income Difference of Rural Residents in Peri-Urbanized Areas and Its Influencing Factors: Evidence from Nanhai, Foshan, China," Sustainability, MDPI, vol. 12(20), pages 1-21, October.
    18. Brandt, Loren & Holz, Carsten A, 2006. "Spatial Price Differences in China: Estimates and Implications," Economic Development and Cultural Change, University of Chicago Press, vol. 55(1), pages 43-86, October.
    19. Guanghua Wan & Zhangyue Zhou, 2005. "Income Inequality in Rural China: Regression‐based Decomposition Using Household Data," Review of Development Economics, Wiley Blackwell, vol. 9(1), pages 107-120, February.
    20. Yuekai Cheng & Hongyi Li & Qi Sun & Yu Wang, 2019. "A Model of Household Savings and Alternative Investments in Rural China," Asian Economic Papers, MIT Press, vol. 18(2), pages 145-162, Summer.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cdl:issres:qt4zc171bm. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Lisa Schiff (email available below). General contact details of provider: https://escholarship.org/uc/issr/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.