China's Rural Labor Migration and Its Economic Development. Xiaoguang Liu

as the foundation of the entire national economy. Since the reform and opening-up, China’s agricultural labor force has kept shifting to the non-agricultural sector, which makes the proportion of the agricultural labor force in the total labor force decrease at an annual rate of more than 1 percentage point. The smooth transformation of China’s economy can be achieved only when the level of the productivity of the agricultural labor force is high and more agricultural products are obtained with less labor consumption. Only in this way can more of the agricultural labor force be transferred to the non-agricultural sector in the society to effectively back up the development of non-agricultural sectors, as well as economic and social transformation.

      

      It is very simple to explain why the development of a large country needs basic agricultural conditions. Improving the efficiency of traditional agricultural production is essential to the growth and transformation of a large economy with a population of more than one billion like China, especially the corresponding growth of agricultural labor productivity. Otherwise, the derivative law of the primary demand for food will fundamentally restrain the process of economic growth or indirectly restrict the process through the increase in agricultural prices beyond the acceptable range (especially for economies in the process of the transfer of agricultural labor). Marx once pointed out that the productivity of agricultural labor exceeding the individual needs of laborers is the foundation of all societies.²⁷ Modern developmental economics even views the growth of the productivity of agricultural labor as the premise for economic development because the food and raw materials produced by the agricultural sector constitute the conditions for the security of the basic materials that meet human existence and developmental needs. With the increase in the quantity of output per unit of labor, it is possible for the social economy to improve its efficiency by deepening the division of labor and to promote the development of material civilization. The practices of economic development in many countries, especially large countries in modern times, have provided extensive international experience to support and verify the above basic laws.

      The observation of the trajectory of the changes in the productivity of agricultural labor is not only an important subject in agricultural economics but also an indispensable aspect for an understanding of the basic prerequisites for the overall transformation of China, a huge economy. Specifically, how has the productivity of agricultural labor changed in China in the 60-year history of the development of new China, especially since the reform and opening-up? What are the characteristics of the trend of the changes in labor productivity at different times and for different categories? Is labor productivity measured by different indicators that are comparable or different? What is the changing situation of the productivity of the marginal agricultural labor against the background of the cross-sectoral transfer of the labor force and the interactive development of the two sectors in China? Besides, the systematic measurement of the productivity of agricultural labor is of great significance for a quantitative description of the improvement in the efficiency of agricultural production and for an understanding of the stage success of China’s economic transformation and growth. Many studies have focused on the analysis of the productivity of agricultural labor in the domestic academic community, but some problems also exist, such as difference in purposes and lack of full and accurate understandings of China’s agricultural labor productivity. According to a rough review of the literature, the situation of agricultural production in China has been studied from different perspectives, but there is still a lack of basic and systematic measurement of the productivity of agricultural labor over a long period of time.

      

      Therefore, this section attempts to systematically estimate the changes in the productivity of agricultural labor through different methods based on the results of the existing research. The systematic estimation and analysis of the trend of change in the system of productivity of agricultural labor in more than 60 years since the founding of the PRC provide the realistic basis for the sustainable and stable transfer of agricultural labor in China. The productivity of agricultural labor is generally defined as the agricultural output brought by agricultural labor input per unit, which can be directly calculated based on the quantity of output and input of labor. It is one of the basic indicators for measuring the level of the efficiency of agricultural production. Besides, different specific indicators can also be used for measurement, depending on the units of measurement of input and output. Agricultural output can be measured either by the value of the market transaction or by the physical unit such as weight and volume. Agricultural labor input can be measured by time units such as hours and man-days. In the absence of support from microscopic investigation data, the number of agricultural laborers may also be used as an approximate measure, but it needs to be assumed that the length of labor and the intensity of the input of agricultural labor per year are roughly comparable in a chronological sense.

      After the reform and opening-up, China changed to a different track to implement and gradually improve the national system of economic accounting and related statistical systems, providing agricultural added value and time series of agricultural labor as well as provincial data. The overall trend of changes in the value-added agricultural average and marginal labor productivity is estimated according to the academic community’s estimation of agricultural capital stocks and the update of this book. Moreover, the data regarding the long-term time series such as laborday input and capital investment per unit area of land with generally stable and comparable data indicators, as well as the panel data of the provinces of origin of the major agricultural products in successive years, are provided according to the data from the national agricultural product costbenefit survey conducted by the relevant departments of the Chinese government. Thus, it is possible to estimate the average and marginal labor productivity of the measurement of the physical quantity of major agricultural products. As a powerful supplement to the estimation of value, the data for the agricultural product cost-benefit survey have three advantages. First, the input from agricultural labor is measured with the number of working days, which helps to eliminate the uncertainty and error of the annual per capita investment of agricultural labor due to the length of the busy season of farming and leisure. Second, the use of physical quantity for statistics helps to eliminate the problems of intertemporal comparability which usually existed in the measurement of value, and even if the price indicator is adjusted to obtain comparable intertemporal data, it is still possible to meet problems involving the quality of the price data and possible uncertain statistical results. Third, the sample survey data based on the area of farmland can automatically control the impact of changes in the land area, facilitating the measurement and estimation of labor productivity.