Institutional change in urbanizing China : a case study of rural shareholding cooperatives in Guangzhou

Abstract

China’s economic reform has not only led to the rapid growth of cities, but also to the dramatic transformation of villages. To fulfill the demand for land and other resources, the state expropriates rural land and the villagers attached to the land are turned into urban residents. Villagers’ committees, the governing body of the village, are also restructured in response to urbanization. For a long period of time, villagers and villagers’ committees have been deemed to be in a weaker position, suffering from the exploitation by the state and a lack of sufficient social welfare. The literature has suggested that the development of modern cities will result in the demise of peasantry and rural collectives. Is this true in Southern China?

As a set of new institutional arrangements, the rural shareholding cooperative (RSC) was created in the 1980s that appeared to have reassembled the power and interests of individual farmers and restored the importance of collective actions in the countryside. Using Guangzhou as a case study, this research attempts to find out what role the RSC plays in China’s urbanization. To achieve this goal, quantitative data were collected from national and local governmental departments to illustrate the “big picture” of rural development and shareholding reform in Guangzhou. Qualitative data were obtained from interviews with government officials, rural cadres and villagers, and from fieldwork conducted in representative towns and villages.

This study also examines the roles of RSC in three aspects: rural governance, land development and welfare provision. Rural governance mainly refers to the impacts of administrative restructuring, village election and kinship. Land development focuses on the retained land policy, rural land use planning and “Three Oldies (old city, old factory and old village)” redevelopment. In terms of welfare provision, rentier issues, conflicts on shareholdership and rural taxation have also been investigated.

The results of spatial analyses and quantitative analyses show that shareholding reform normally took place in economically developed villages situated in locations that were close to the city center. Analyses on rural governance show that RSC has remodeled the interactions of state, cadres and villagers. The powers of these parties have become more balanced now. RSC can also promote physical urbanization in the countryside via profitable development projects and new arrangements on rural planning and land property rights. Moreover, the RSC can facilitate villagers to acquire labor skills, a sense of social equity and awareness as taxpayers.

This study has updated the empirical works on institutional change in rural southern China. More importantly, it has examined the new roles of rural collective organizations and contributed to the theories on collectivization in the post-reform era, which have been largely ignored by previous research. Findings of this study imply that the RSC is playing a critical part in China’s urbanization process. As an emerging form of rural collective, it can facilitate rural-urban transformation or even achieve unprecedented integration of Chinese villages and cities.