Household Responsibility System

The household responsibility system (household contract responsibility system with remuneration linked to output) has been a crucial state policy the Chinese government adopted since 1978. Literally, "responsibility" means that an individual household, or a group of households, assumes the task of production for and payment to the government.

The practice of household responsibility was in fact initiated by a group of farmers in a small village in Anhui Province, central China. The late Chinese leader Deng Xiaoping once termed it "a great invention of Chinese farmers."

The system contains two features. First, farmland is still owned by the public. Second, production and management are turned over to individual farming households through signing long-term contracts. During the contract period, the farmers pay agricultural taxes to the state and their contributions to collective reserves, and keep all the rest for themselves.

The system was so warmly endorsed by farmers that by the end of 1983 it had been adopted for more than 90 percent of the country's farming households. The system not only released rural productive forces but also turned out to be a fundamental breakthrough in rural reforms.

Firstly, the system has greatly inspired farmers' production initiative, sharply increased agricultural output, and raised rural productivity. Secondly, large amounts of rural labor force were released from tilling the land to take up jobs in village-run factories and township enterprises, which have evolved into an important sector in the rural economy. Thirdly, the system transformed production mode in rural areas and changed farmers' lifestyle. It helped elevate farmers from self-sufficient petty producers to commodity producers and managers, while promoting the development of the rural market. Finally, with rapid development of the rural economy, farmers' living standards have been improved markedly. Many of them are now living a relatively well-off life.

Household responsibility system has greatly emancipated and developed rural productive forces, promoted the rapid growth of agriculture — particularly grain production — and the continuous optimization of agricultural structure. The achievements have been remarkable. China now leads the world in output of grain, cotton, oil-bearing crops, fruit, meat, eggs, aquatic products, and vegetables.