China has experienced rapid rural transformation in the past four decades.  Accompanying the rapid transformation is a significant rise in rural household income and a substantial fall in rural poverty.  This paper examines the evolutions of and the relationships between rural transformation (high-value agriculture and rural non-farm employment) and its outcomes (per capita rural income and rural poverty incidence) using provincial-level ata.  The results show that 31 provinces/autonomous regions/municipalities have undergone significant rural transformation, but the level and speed of rural transformation differed considerably.  Moreover, an increased level of rural transformation is often associated with higher per capita rural income and reduced rural poverty incidence.  Notably, a category of provincial rural transformation based on high-value agriculture and rural non-farm employment is also analyzed.  We further discuss the likely impacts of institutions, policies, and investments (IPIs) on rural transformation and conclude with policy implications.

All developing countries experience a process of rural transformation (RT), and the evidence available to date says that economies that transform their rural sectors more rapidly achieve faster growth and are also more inclusive.  However, not all countries are successful.  This special focus contains five papers related to the nature of rural transformation, its components, and consequences.¹

All authors respond to the proposition that understanding the nature and impact of RT is essential for policymakers, because of their role in its success.  A theme of the collection is the regional diversity in the experience of rural transformation and the value of the design of region-specific policies.

Wang et al. (2023) provide a comprehensive analysis of the concept of RT, its measurement, and the various indicators used in related studies.  They adopt a definition of RT that is more extensive than the simple transformation of agriculture but also retains a focus on the rural economy (and, therefore, is a subset of the structural transformation of the whole economy).  They refer to the text of the definition by IFAD (2016, p. 23) as involving ‘rising agricultural productivity, commercialisation and diversification of production patterns and livelihoods,’ which also involves expanded off-farm employment.   The process also has consequences for inclusion and sustainability.

A feature of RT is the greater use of markets for outputs such as high-value crops and inputs such as labour.  The development of markets in complementary services, such as transport and storage, also supports the use of output markets.  The authors note that RT involves significant changes in rural areas, including shifts in farming practices, land use, population movements, and interactions between primary and other sectors.   

Given all its dimensions, the measurement of RT is a challenge. Current methods and indicators are often insufficient for policy decision-making due to a lack of objectivity, feasibility, accountability, comprehensiveness, and comparability. This study reviews various indicators, such as those referring to components including labour productivity, commercialisation, diversification, inclusiveness, and sustainability. The authors argue that future research could develop more effective measures to assess RT, especially in developing countries, and they review a range of options for further attention.

Shi and Huang (2023) examine the dynamic relationship between RT and its consequences.  They concentrate on its impacts on income growth, and poverty reduction across different regions in China over the past 40 years. The study uses provincial-level data to form indicators of RT.  Specifically, they assess how shifts from traditional agriculture to high-value agriculture (RT₁) and the rise of non-farm employment (RT₂) have impacted rural income and poverty.  These indicators are commonly used in papers in the research project from which this collection is drawn.

The study finds: 1) a positive correlation between both aspects of RT and per capita rural income. While both RT₁ and RT₂ have resulted in a significant increase in rural income, RT₁’s impacts occur more in the later stage than early stage of RT, and RT₂’s impacts happen in every stage of RT.  2) RT₁ and RT₂ have significantly contributed to the reduction of rural poverty.  The effect of RT₁ is more dominant in the early stages of RT, while RT₂ becomes more influential in later stages.  3) The level and speed of RT, along with its effects on income and poverty, vary considerably across regions. Eastern provinces, which are more economically developed, show higher levels of RT and better outcomes in terms of income growth and poverty reduction than other regions.

The findings suggest the importance of targeted policies that promote high-value agriculture and expand rural non-farm employment according to the stage of transformation. And the paper also emphasizes the value of region-specific strategies and policies.

Sudaryanto et al. (2023) explore the impact of RT on household income and poverty in Indonesia over the last 20 years.

They report that RT in Indonesia has been characterized by rapid agricultural growth, particularly in the production of horticulture, estate crops, and livestock, which has surpassed the growth in grain production.  This shift reflects farmers’ orientation from subsistence to market-driven production.  Additionally, there has been an increasing engagement of rural laborers in non-farm employment, contributing to the diversification of rural economies.

Then, using data from 34 provinces in Indonesia from 2000 to 2020, they find growth in both RT₁ and RT₂, with each also positively associated with the growth of rural household income and a decrease in poverty rates. However, they find that the speed of this structural transformation and its consequences varies across regions.

However, there are regional disparities: Regions with a higher level of RT, like those centred around major cities such as Medan and Jakarta, show a more significant increase in household income and a more pronounced reduction in poverty. In contrast, less developed regions, especially those in Eastern Indonesia, face more significant challenges in reducing poverty.  

Policies aimed at improving rural income and reducing poverty should integrate, the authors of the Indonesia paper argue, approaches promoting high-value agriculture and expanding rural non-farm employment, but also pay special attention to regional situations and adopt a contextual policy framework that considers regional diversification in natural resources endowments as well as socio-cultural aspects.

Abedullah et al. (2023) explore the role of RT in enhancing rural per capita income and reducing poverty in Pakistan from 1981 to 2019.  The research uses district-level data to measure RT₁ and RT₂.  The authors find that: 1) Both RT₁ and RT₂ positively affect rural per capita income, with RT₁ having a more pronounced impact than RT₂ (as in the case of China).  2) Both RT₁ and RT₂ are effective in reducing rural poverty, but RT₂ becomes more in the later stages of rural development (as also the case in China).  3) Significant regional disparities occur in the process and impact of RT. Districts at advanced stages of RT positively correlate with increased income and reduced poverty rate (as was also found in both China and Indonesia).

We noted RT’s contribution to inclusion generally, but another important element of the work completed to date is attention to RT’s gender inclusiveness.  Rola-Rubzen et al. (2023) systematically review 84 studies from 1960 to 2021 to understand how RT affects gender indicators and how gender inclusiveness influences RT.

RT significantly impacts women’s work, income, empowerment, wellbeing, and time allocation. It leads to positive outcomes for women, such as increased employment and empowerment opportunities, but also introduces challenges, including unstable income sources and increased workloads.

Due to RT, women are working more, including greater involvement in both on-farm labour and off-farm or non-agricultural employment. While this shift can improve women’s livelihoods, it also results in complexities such as wage discrimination and job insecurity.

The stability of the additional income associated with RT is questionable. Shifts towards high-value agricultural commodities, for example, contribute to reduced income stability. Moreover, women’s increased income does not always equate to increased control over household financial resources.

RT can enhance women’s empowerment, mainly through increased educational opportunities for girls and improved income. Nevertheless, shifts to high-value agriculture sometimes reduce women’s control over income and resources, indicating a complex interplay between RT and empowerment.

In summary, these papers find a positive association of the indicators of rural transformation (high-value products and off-farm employment) with rural income growth and poverty reduction, but with differential impacts at different stages of development.  All studies also finds significant regional variation in performance.

These studies recommends targeted policies to enhance high-value agriculture and expand rural non-farm employment but with region-specific strategies.  The research also highlights the challenges in implementing effective RT strategies, such as land distribution inequalities, credit market limitations, and access to modern agricultural techniques.

The work has led to discussion of policy options that might accelerate rural transformation.  The next step is to systematically consider the drivers of the changes in rural transformation indicators.  The framework applied in the project from which these papers are drawn pays attention to institutions, policies, and investments (IPIs).  Each component of the IPIs is likely to contribute to both RT₁ and RT₂ to varying degrees.  The study of the association of elements of the IPIs with the indicator and, thereby, the outcomes of RT is a topic of current research.  However, some work on the relevant components of the IPIs has been published for the case of China (Huang 2022), which provides direction for this research.  

Relevant institutions, for example, include the conditions of access to land (the development of land markets, in other words) and markets for water and labour.  Markets that support the application of mechanisation are also expected to be essential, as will other markets for complementary services.  Various policies will also influence the emergence of new markets (Barrett et al. 2022).  

Other relevant policies include those affecting incentives faced by rural households, including price regulation, trade policy management, and applying taxes and subsidies.  Sometimes, these linkages also operate in both directions (from policy to RT and back again): an example is trends in trade policy (Anderson 2023) and foreign direct investment (Hu et al. 2023).

Examples of investments include those related to infrastructure (such as roads or irrigation) and technology (through systems of research and development applied to agriculture). As noted, these are topics for further work, intending to map the priorities among the IPIs for accelerating RT depending on its current stage and regional context.  

While RT generally leads to positive outcomes for women, it also presents risks and challenges.  Future RT policies and programs should be more gender-inclusive to maximize benefits for women and further RT itself.  These are critical elements of the larger package of IPIs. 

Global tea consumption has risen significantly alongside rapid expansion of international trade in recent years.  However, few studies have systematically examined the relationship among the major tea markets worldwide.  Using weekly data from 2012–2019, this study empirically analyzed the price series of the world’s major black tea auction markets.  The estimation results showed that these markets are connected, even though heterogeneities vary.  This finding holds not only for regional markets but also for international markets.  The findings offer important implications for tea-producing countries with millions of smallholder farmers.

China’s food supply and demand have significant implications for both China’s own national food security and that of the world.  This study reviews China’s food security prospects and their implications, focusing on international trade in the coming decade.  The results show that China’s policies for ensuring food security will be enhanced and China will move to sustainable agriculture.  Most studies anticipate that China will increase its food and feed imports in the coming decade.  China’s overall food self-sufficiency is likely to fall from 94.5% in 2015 to around 91% by 2025.  The greatest increases in imports are likely to be soybean, maize, sugar, and dairy products.  However, within the production capacity of the major exporting countries and of many food-importing developing countries, China’s additional imports of 3 to 5% of its total food consumption in the coming decade are unlikely to threaten global food security.  Indeed, the projected imports of feed and several foods could provide opportunities for many exporting countries to expand their production and save global resources.  

Even though the impact of Bacillus thuringiensis (Bt) cotton on pesticide use has been well documented, all previous studies focus on the mean value of pesticide use.  Using seven unique waves of panel data collected between 1999 and 2012 in China, we show that Bt cotton adoption has not only caused a reduction of the mean value of pesticide use, but also a reduction of the standard deviation of pesticide use.  We conclude that Bt technology adoption has also contributed to the stability of pesticide use in cotton production.  We believe that this contribution is theoretically and practically relevant because of the long length of our unique dataset.

The debate about the safety of genetically modified (GM) food has attracted public attention in concurrence with the rapid development of agricultural biotechnology. This paper examines the consumers’ perceptions on the safety of GM food in China. Based on a unique survey dataset, this study shows that consumers in urban China have significantly changed their perceptions on GM food safety. The percentage of consumers who perceived such food as unsafe for consumption increased by more than 30% in the 2002–2012 period. Approximately half of the consumers did not have an opinion on this issue. Major shifts have been occurred after 2010, likely because of the increasing influence of negative media reports on GM technology in recent years. Several individual and household’s characteristics are shown to significantly affect consumers’ perceptions on GM food safety, such as gender, education, food allergy experience and resident city size. The paper concludes with policy implications.

With the rapid growth of China’s economy, rising demand for safety food has been accompanied by frequent food safety scandals. Given that China’s farming is dominated by millions of small-scale farms, ensuring food safety is a major challenge facing the public and private sectors. The direct farm (DF) program, initiated in 2008, represents one of the government’s major initiatives to modernize the distribution of fresh fruit and vegetables (FFV) and improve food safety. Under the DF program, participating national and international retailers are expected to establish more direct procurement relationships with farm communities. While it is often claimed that greater participation by retailers in the production and post-harvest processing implied the DF program will lead to improved quality, safety and traceability, systematic evidence remains elusive as existing studies are largely narrative, based on case studies, or theoretical inference. Little empirical evidence is available for a broader evaluation of the DF program. This paper aims to fill this gap by assessing the overall performance of a single retailer’s DF experience with respect to the procurement and food safety of FFV. We use data from a survey of production managers of 35 DF production bases (PBs) spread across 11 provinces, 3 cities and 1 autonomous region in China. The results show a mixture of opportunities and challenges. On one hand, the DF program improves production practices and distribution channels of FFV produced on its PBs, thus facilitating the move of China’s food system towards improved food safety compliance. On the other hand, significant heterogeneity in the traceability of food and the ability of DF to meet higher safety standards is evident both across major product categories and across household-operated vs. firm-operated PBs. The paper concludes with policy implications.

Agriculture is facing great challenge in meeting global food security and is expected to face even greater challenge under climate change. The overall goal of this paper is to examine how finance can be used to achieve the joint objectives of development, mitigation of and adaptation to climate change in agriculture in developing world based on literature review. The results show that agriculture is much under invested and foreign aid also has not increased appropriately to assist developing countries to maintain sustainable agriculture under climate change. There are a wide range of areas in mitigation of and adaptation to climate change that need substantial investment. Major areas and successful cases mitigation of and adaptation to climate change in agriculture that have worked in developing countries are examined. A list of areas that have worked, could work and be scaled up or transferred is identified and discussed. This study concludes that mainstreaming agricultural mitigation and adaptation into agricultural development programs, enhancing local capacity, and considering different stakeholders’ needs are major experiences for successfully financing sustainable agriculture under climate change.

Under climate change, rising frequency and serious extreme weather events have challenged agricultural production. Designing appropriate adaptation measures to the extreme weather events require rigorous and empirical analysis. The overall goals of this study are to understand physical adaptation measures taken by farmers and the impacts of household and community assets on farmers’ adaptation when they face drought. The analyses are based on a unique data set collected from a household survey in three provinces in China. The survey results show that though not common on annual basis, some farmers did use physical adaptation measures to fight drought. Regression analysis reveals that both household and community assets significantly affect farmers’ adaptation behaviors. Improving households’ social capital and wealth, communities’ network and access to government’s anti-drought service can facilitate farmers’ adaptation to drought. Results indicate that community’s irrigation infrastructure and physical adaptation taken by farmers can substitute each other. Further analysis shows that the households taking adaptation measures have higher crop yields than those without taking these measures. The paper concludes with several policy implications.

Apart from the long-term effects of climate change, the frequency and severity of extreme weather events have been increasing. Given the risks posed by climate change, particularly the changes in extreme weather events, the question of how to adapt to these changes and mitigate their negative impacts has received great attention from policy makers. The overall goals of this study are to examine whether farmers adapt to extreme weather events through crop diversification and which factors influence farmers’ decisions on crop diversification against extreme weather events in China. To limit the scope of this study, we focus on drought and flood events only. Based on a unique large-scale household survey in nine provinces, this study finds that farmers respond to extreme weather events by increasing crop diversification. Their decision to diversify crops is significantly influenced by their experiences of extreme weather events in the previous year. Such results are understandable because farmers’ behaviors are normally based on their expectations. Moreover, household characteristics also affect farmers’ decisions on crop diversification strategy, and their effects differ by farmers’ age and gender. This paper concludes with several policy implications.

Empirical research has shown that the use of manure significantly improves crop yield, soil fertility and water and moisture conservation. Despite these documented benefits, however, there is a concern on the downward trend of manure use in agriculture in China. This paper examines factors contributing to this downward trend, with a particular focus on human excreta used in agriculture. Empirical analysis based on data from stratified random sampling of rural households in five provinces of China shows that about 85% of human excreta was still used as manure in agriculture in 2007 which was less than a decade ago when nearly all human excreta was used as manure. Econometric results suggest that income growth, rising population density and improvement in rural transportation significantly contribute to declining use of human excreta as manure in agriculture. These results imply that the current downward trend will continue given China’s rising economic growth, urbanization and rural infrastructural improvement.

The purpose of this paper is to document the likely impacts of climate change on China’s agriculture and the current adaptation efforts made by government and farmers. The review of literature shows that climate change will have a significant impact on agriculture, primarily through its effect on crop yields. The extent of predicted impacts highly depends on the crop, the CO2 fertilization effect assumption and adaptation abilities. Market response to the production shocks resulting from climate change will lessen the impacts on agricultural production predicted by natural scientists. On adaptation, the government’s major efforts have been in the developing new technologies, reforming extension system and enhancing institutional capacity. Farmers do adapt to climate change, but their adaptation measures cannot fully offset the negative impacts of climate change. The paper concludes and makes implications for future studies.

The overall goal of this paper is to examine impacts of climate change on water supply and demand balance and their consequences on agricultural production in ten river basins in China. To realize this goal, China Water Simulation Model (CWSM) is used to analyze three alternative climate scenarios (A1B, A2 and B2). The results show that the impacts of climate change on water supply and demand balance differ largely among alternative scenarios. While significant impacts of climate change on water balance will occur under the A1B scenario, the impacts of climate change under the A2 and B2 scenarios will be marginal. Under the A1B scenario, the water shortage in the river basins located in the northern China will become more serious, particularly in Liaohe and Haihe river basins, but the other river basins in the southern China will improve their water balance situations. Despite larger impacts of climate change on water balance in the northern China, its impacts on total crops’ production will be moderate if farmers would be able to reallocate water among crops and adjust irrigated and rainfed land. The paper concludes with some policy implications.

Chemical fertilizer plays an important role in increasing food production in China. Nevertheless, excessive nitrogen fertilizer use in China has resulted in severe environmental problems. The goal of this paper is to examine the impacts of an improved nitrogen management (INM) training experiment on farmers’ chemical nitrogen (N) use behaviors in maize production in China. Based on household data collected from 813 maize farmers in Shandong, China, this study finds that while INM training can significantly reduce farmers’ N fertilizer use, an INM training is not sufficient to change farmer’s practices significantly, and farmers only partially adopted the recommended INM. This study reveals that China faces challenges to transform its agriculture to a low-carbon one. The research also sheds light on China’s extension system and future technologies in meeting the objectives of reducing the excessive nitrogen fertilizer use in agricultural production.

Food safety standard draws increasing concerns on agricultural trade throughout the world. This paper aims to assess the impact of maximum residual limit standard (MRL) of chloromycetin on honey exporting from China. To achieve this objective, the paper discusses the trends of China’s honey production and export practices, analyzes changes on MRL of chloromycetin adopted by major importing countries, and use a gravity model to estimate the impact of MRL of chloromycetin on China’s honey export. The results show that despite the rapid growth of China’s honey production, honey export has declined significantly since 2000. The major reason of declining honey export was mainly due to the more stringent food safety standards indicated by MRL of chloromycetin imposed by importing countries on their honey imports.

Genetically modified (GM) technology can significantly reduce pesticide use and increase yield in crop production. However, the benefit from reducing pesticide use varies substantially among farmers. The overall goal of this paper is to understand the relationship between farmers’ knowledge of GM technology and pesticide use in genetically modified papaya (GMP) production. Based on a survey of 223 farms in three main papaya production provinces in 2010, the data show that almost all papaya planted in 2009 was genetically modified. However, only 28% of papaya farmers knew that they planted GMP, and 55% of them did not know GMP is resistant to papaya ringspot virus (PRSV). Further analyses using the general least squares (GLS) method show that farmers’ knowledge of GMP significantly affects their pesticide use, and potential gain from GM technology is far below its full potential. The paper concludes with policy implications.