IDEAS home Printed from https://ideas.repec.org/h/fpr/ifpric/9780896293809_02.html
   My bibliography  Save this book chapter

Mechanization outsourcing clusters and division of labor in Chinese agriculture

In: An evolving paradigm of agricultural mechanization development: How much can Africa learn from Asia?

Author

Listed:
  • Zhang, Xiaobo
  • Yang, Jin
  • Reardon, Thomas

Abstract

Despite small landholdings, a high degree of land fragmentation, and rising labor costs, agricultural production in China has steadily increased. If one treats the farm household as the unit of analysis, it is difficult to explain the conundrum. When seeing agricultural production through the lens of the division of labor, the puzzle can be easily solved. In response to rising labor costs, farmers outsource some power-intensive stages of production, such as harvesting, to specialized mechanization service providers, which are often clustered in a few counties and travel throughout the country to provide harvesting services at competitive prices. Through such an arrangement, smallholder farmers can stay viable in agricultural production.

Suggested Citation

  • Zhang, Xiaobo & Yang, Jin & Reardon, Thomas, 2020. "Mechanization outsourcing clusters and division of labor in Chinese agriculture," IFPRI book chapters, in: An evolving paradigm of agricultural mechanization development: How much can Africa learn from Asia?, chapter 2, pages 71-96, International Food Policy Research Institute (IFPRI).
    • Handle: RePEc:fpr:ifpric:9780896293809_02
    as

    Download full text from publisher

    File URL: https://www.ifpri.org/cdmref/p15738coll2/id/134088/filename/134308.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Zhang, Xiaobo & Yang, Jin & Wang, Shenglin, 2011. "China has reached the Lewis turning point," China Economic Review, Elsevier, vol. 22(4), pages 542-554.
    2. Brambilla, Irene & Porto, Guido, 2005. "Farm Productivity and Market Structure: Evidence from Cotton Reforms in Zambia," Working Papers 5, Yale University, Department of Economics.
    3. Deininger, Klaus & Jin, Songqing, 2009. "Securing property rights in transition: Lessons from implementation of China's rural land contracting law," Journal of Economic Behavior & Organization, Elsevier, vol. 70(1-2), pages 22-38, May.
    4. Jin Yang & Zuhui Huang & Xiaobo Zhang & Thomas Reardon, 2013. "The Rapid Rise of Cross-Regional Agricultural Mechanization Services in China," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 95(5), pages 1245-1251.
    5. Diao, Xinshen & Cossar, Frances & Houssou, Nazaire & Kolavalli, Shashidhara & Jimah, Kipo & Aboagye, Patrick, 2012. "Mechanization in Ghana: Searching for sustainable service supply models:," IFPRI discussion papers 1237, International Food Policy Research Institute (IFPRI).
    6. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," Review of Economic Studies, Oxford University Press, vol. 70(2), pages 317-341.
    7. Olmstead, Alan L. & Rhode, Paul W., 1995. "Beyond the Threshold: An Analysis of the Characteristics and Behavior of Early Reaper Adopters," The Journal of Economic History, Cambridge University Press, vol. 55(1), pages 27-57, March.
    8. Coase Ronald H & Wang Ning, 2011. "The Industrial Structure of Production: A Research Agenda for Innovation in an Entrepreneurial Economy," Entrepreneurship Research Journal, De Gruyter, vol. 1(2), pages 1-13, March.
    9. Kazushi Takahashi & Keijiro Otsuka, 2009. "The increasing importance of nonfarm income and the changing use of labor and capital in rice farming: the case of Central Luzon, 1979–2003," Agricultural Economics, International Association of Agricultural Economists, vol. 40(2), pages 231-242, March.
    10. Jayasuriya, S. K. & Shand, R. T., 1986. "Technical change and labor absorption in Asian agriculture: Some emerging trends," World Development, Elsevier, vol. 14(3), pages 415-428, March.
    11. Pingali, Prabhu, 2007. "Agricultural Mechanization: Adoption Patterns and Economic Impact," Handbook of Agricultural Economics, in: Robert Evenson & Prabhu Pingali (ed.), Handbook of Agricultural Economics, edition 1, volume 3, chapter 54, pages 2779-2805, Elsevier.
    12. George J. Stigler, 1951. "The Division of Labor is Limited by the Extent of the Market," Journal of Political Economy, University of Chicago Press, vol. 59, pages 185-185.
    13. Peter Timmer, C., 1988. "The agricultural transformation," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 1, chapter 8, pages 275-331, Elsevier.
    14. Binswanger, Hans, 1986. "Agricultural Mechanization: A Comparative Historical Perspective," World Bank Research Observer, World Bank Group, vol. 1(1), pages 27-56, January.
    15. Prabhu L. Pingali, 1997. "From Subsistence to Commercial Production Systems: The Transformation of Asian Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(2), pages 628-634.
    16. Robert Evenson & Prabhu Pingali (ed.), 2007. "Handbook of Agricultural Economics," Handbook of Agricultural Economics, Elsevier, edition 1, volume 3, number 1.
    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. Bhattarai, Madhusudan & Joshi, Pramod Kumar & Shekhawa, R. S. & Takeshima, Hiroyuki, 2017. "The evolution of tractorization in India’s low-wage economy: Key patterns and implications," IFPRI discussion papers 1675, International Food Policy Research Institute (IFPRI).
    2. Yating, Zeng & Yanhong, Jin & Zhong, Tang, 2016. "Investigating the Relationship between Land and Labor Endowments and Agricultural Mechanization among Chinese Farmers," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 236367, Agricultural and Applied Economics Association.
    3. Guo, Hongdong & Ji, Chen & Jin, Songqing & Huang, Zuhui, 2015. "Outsourcing Agricultural Production: Evidence from Rice Farmers in Zhejiang Province," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 206079, Agricultural and Applied Economics Association.
    4. Fan Fan & Bei Li & Weifeng Zhang & John R. Porter & Fusuo Zhang, 2021. "Evaluation of Sustainability of Irrigated Crops in Arid Regions, China," Sustainability, MDPI, Open Access Journal, vol. 13(1), pages 1-15, January.
    5. Hiroyuki Takeshima & Yanyan Liu, 2018. "The Role of Plant-Breeding R&D in Tractor Adoption among Smallholders in Asia: Insights from Nepal Terai," Working Papers id:12748, eSocialSciences.
    6. Reardon, Thomas & Echeverria, Ruben & Berdegué, Julio & Minten, Bart & Liverpool-Tasie, Saweda & Tschirley, David & Zilberman, David, 2019. "Rapid transformation of food systems in developing regions: Highlighting the role of agricultural research & innovations," Agricultural Systems, Elsevier, vol. 172(C), pages 47-59.
    7. Takeshima, Hiroyuki & Houssou, Nazaire & Diao, Xinshen, 2018. "Effects of tractor ownership on returns-to-scale in agriculture: Evidence from maize in Ghana," Food Policy, Elsevier, vol. 77(C), pages 33-49.
    8. Xin Deng & Zhongcheng Yan & Dingde Xu & Yanbin Qi, 2020. "Land Registration, Adjustment Experience, and Agricultural Machinery Adoption: Empirical Analysis from Rural China," Land, MDPI, Open Access Journal, vol. 9(3), pages 1-14, March.
    9. Takeshima, Hiroyuki, 2015. "Identifying the effects of market imperfections for a scale biased agricultural technology: Tractors in Nigeria," 2015 Conference, August 9-14, 2015, Milan, Italy 211937, International Association of Agricultural Economists.
    10. Gulati, Kajal & Lybbert, Travis J. & Spielman, David J., 2017. "Diffusing to level fields: Evolution of laser land leveling technology markets in India," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258387, Agricultural and Applied Economics Association.
    11. Rada, Nicholas & Wang, Chenggang & Qin, Lijian, 2015. "Subsidy or market reform? Rethinking China’s farm consolidation strategy," Food Policy, Elsevier, vol. 57(C), pages 93-103.
    12. Zhang, Jian & Mishra, Ashok K. & Zhu, Peixin & Li, Xiaoshun, 2020. "Land rental market and agricultural labor productivity in rural China: A mediation analysis," World Development, Elsevier, vol. 135(C).
    13. Hiroyuki Takeshima & Yanyan Liu & Ian Masias, 2018. "Evolution of Agricultural Mechanization in Vietnam: Insights from a Literature Review and Multiple Rounds of a Farm Household Survey," Working Papers id:12785, eSocialSciences.
    14. Geneviève Nguyen & Julien Brailly & François Purseigle, 2020. "Strategic outsourcing and precision agriculture: towards a silent reorganization of agricultural production in France ?," Post-Print hal-02942720, HAL.
    15. Takeshima, Hiroyuki & Adhikari, Rajendra Prasad & Kumar, Anjani, 2016. "Is access to tractor service a binding constraint for Nepali Terai farmers? :," IFPRI discussion papers 1508, International Food Policy Research Institute (IFPRI).
    16. Hong, Yu & Heerink, Nico & van der Werf, Wopke, 2020. "Farm size and smallholders’ use of intercropping in Northwest China," Land Use Policy, Elsevier, vol. 99(C).
    17. Qiangqiang Zhang & Beibei Yan & Xuexi Huo, 2018. "What Are the Effects of Participation in Production Outsourcing? Evidence from Chinese Apple Farmers," Sustainability, MDPI, Open Access Journal, vol. 10(12), pages 1-15, November.
    18. Song, Feng & Reardon, Thomas & Tian, Xin & Lin, Chen, 2019. "The energy implication of China’s food system transformation," Applied Energy, Elsevier, vol. 240(C), pages 617-629.
    19. Idelphonse O. Saliou & Afio Zannou & Augustin K. N. Aoudji & Albert N. Honlonkou, 2020. "Drivers of Mechanization in Cotton Production in Benin, West Africa," Agriculture, MDPI, Open Access Journal, vol. 10(11), pages 1-13, November.
    20. Deng, Xin & Xu, Dingde & Zeng, Miao & Qi, Yanbin, 2019. "Does Internet use help reduce rural cropland abandonment? Evidence from China," Land Use Policy, Elsevier, vol. 89(C).
    21. Liu, Yanyan & Barrett, Christopher B. & Pham, Trinh & Violette, William, 2020. "The intertemporal evolution of agriculture and labor over a rapid structural transformation: Lessons from Vietnam," Food Policy, Elsevier, vol. 94(C).
    22. Hatzenbuehler, Patrick L. & Takeshima, Hiroyuki & Edeh, Hyacinth & Lawal, Akeem, 2018. "Cost and policy determinants of features of tractor markets in Nigeria: Case studies of tractor sellers in Kaduna state and tractor owners in Benue state," NSSP working papers 55, International Food Policy Research Institute (IFPRI).

    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. Adu-Baffour, Ferdinand & Daum, Thomas & Birner, Regina, 2018. "Can Big Companies’ Initiatives to Promote Mechanization Benefit Small Farms in Africa? A Case Study from Zambia," Discussion Papers 273521, University of Bonn, Center for Development Research (ZEF).
    2. Adu-Baffour, Ferdinand & Daum, Thomas & Birner, Regina, 2019. "Can small farms benefit from big companies’ initiatives to promote mechanization in Africa? A case study from Zambia," Food Policy, Elsevier, vol. 84(C), pages 133-145.
    3. Rob Vos, 2018. "Agricultural and rural transformations in Asian development," WIDER Working Paper Series 87, World Institute for Development Economic Research (UNU-WIDER).
    4. Paudel, Gokul P. & KC, Dilli Bahadur & Rahut, Dil Bahadur & Justice, Scott E. & McDonald, Andrew J., 2019. "Scale-appropriate mechanization impacts on productivity among smallholders: Evidence from rice systems in the mid-hills of Nepal," Land Use Policy, Elsevier, vol. 85(C), pages 104-113.
    5. Thomas Daum & Regina Birner, 2017. "The neglected governance challenges of agricultural mechanisation in Africa – insights from Ghana," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 9(5), pages 959-979, October.
    6. Takeshima, Hiroyuki & Houssou, Nazaire & Diao, Xinshen, 2018. "Effects of tractor ownership on returns-to-scale in agriculture: Evidence from maize in Ghana," Food Policy, Elsevier, vol. 77(C), pages 33-49.
    7. Fan, Shenggen & Brzeska, Joanna & Keyzer, Michiel & Halsema, Alex, 2013. "From subsistence to profit: Transforming smallholder farms," Food policy reports 26, International Food Policy Research Institute (IFPRI).
    8. Takeshima, Hiroyuki & Liu, Yanyan & Cuong, Nguyen Van & Masias, Ian, 2018. "Evolution of agricultural mechanization in Vietnam: Insights from a literature review and multiple rounds of a farm household survey:," IFPRI discussion papers 1724, International Food Policy Research Institute (IFPRI).
    9. Sara Ratna Qanti & Thomas Reardon & Arief Iswariyadi, 2017. "Triangle of Linkages among Modernising Markets, Sprayer–traders, and Mango-farming Intensification in Indonesia," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 53(2), pages 187-208, May.
    10. Alwin Keil & Alwin D’Souza & Andrew McDonald, 2016. "Growing the service economy for sustainable wheat intensification in the Eastern Indo-Gangetic Plains: lessons from custom hiring services for zero-tillage," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 8(5), pages 1011-1028, October.
    11. Diao, Xinshen & Cossar, Frances & Houssou, Nazaire & Kolavalli, Shashidhara, 2014. "Mechanization in Ghana: Emerging demand, and the search for alternative supply models," Food Policy, Elsevier, vol. 48(C), pages 168-181.
    12. Anupam Sarkar, 2020. "Agricultural Mechanization in India: A Study on the Ownership and Investment in Farm Machinery by Cultivator Households across Agro-ecological Regions," Millennial Asia, , vol. 11(2), pages 160-186, August.
    13. Takeshima, Hiroyuki, 2015. "Identifying the effects of market imperfections for a scale biased agricultural technology: Tractors in Nigeria," 2015 Conference, August 9-14, 2015, Milan, Italy 211937, International Association of Agricultural Economists.
    14. Yang, Qiming & Zhang, Xiaobo & Zhu, Wu, 2016. "Have Chinese firms become smaller? If so, why?:," IFPRI discussion papers 1558, International Food Policy Research Institute (IFPRI).
    15. Shenggen Fan & Ravi Kanbur & Shang-Jin Wei & Xiaobo Zhang, 2013. "The Economics of China: Successes and Challenges," NBER Working Papers 19648, National Bureau of Economic Research, Inc.
    16. Keijiro Otsuka & Yanyan Liu & Futoshi Yamauchi, 2016. "The future of small farms in Asia," Development Policy Review, Overseas Development Institute, vol. 34(3), pages 441-461, May.
    17. Deininger, Klaus & Jin, Songqing & Xia, Fang & Huang, Jikun, 2014. "Moving Off the Farm: Land Institutions to Facilitate Structural Transformation and Agricultural Productivity Growth in China," World Development, Elsevier, vol. 59(C), pages 505-520.
    18. Gulati, Kajal & Lybbert, Travis J. & Spielman, David J., 2017. "Diffusing to level fields: Evolution of laser land leveling technology markets in India," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258387, Agricultural and Applied Economics Association.
    19. Liu, Yanyan & Barrett, Christopher B. & Pham, Trinh & Violette, William, 2020. "The intertemporal evolution of agriculture and labor over a rapid structural transformation: Lessons from Vietnam," Food Policy, Elsevier, vol. 94(C).
    20. Liang Lu & Thomas Reardon & David Zilberman, 2016. "Supply Chain Design and Adoption of Indivisible Technology," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 98(5), pages 1419-1431.

    More about this item

    Keywords

    CHINA; EAST ASIA; ASIA; agricultural mechanization; policies; technology; governance; agriculture; clusters; agricultural production; remuneration; farmers; smallholders; rural areas; farm equipment; pesticides; fertilizers; supply balance; harvesters; harvesting; surveys; labour; outsourcing; farm mechanization;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

    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:fpr:ifpric:9780896293809_02. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (). General contact details of provider: http://edirc.repec.org/data/ifprius.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.