Wednesday, February 1, 2012

Collective action that transformed Chinese Economy

Yen Jingchang was a farmer living in remote rural area of China. He took lead to transform Chinese economy using the principles of collective action. This little known story is worth reading.

30 comments:

pastride said...
This comment has been removed by the author.
pastride said...

It is a typical case in which the idea put forward by Xiaogang was legitimate but was against the ideology of the state. But the state was tolerant to the outcome of the idea and later we could see that the state adopted the ideology. The idea was radical and practically feasible hence was able to generate interest among the people and they could see incentive for being a part of it. A mutual agreement in the form of bond also gives indication of the existence of a nuclear institution even in the early phase of the ideology- Tijil(32045)

Shipra Sharma said...

Initially the story seems to be a tale of success for the Xiaogang farmers in the light of principles of collective action where the movement was tolerated by the communist government of China even though the ideology of the state was different from that of the leader ‘Yen Jingchang’. Also the ideology seemed to be adopted and replicated by the state. However after going through the last few paragraphs it shaped into a different reality where the movement failed to sustain because the members end up getting nothing out of their hard work.
Shipra Sharma
(32092)

Rajeev said...

A nice read! I am interested in pointing out the role of Yen Hongchang in the whole scheme of things. It looks like he played the role of a leader in the accomplishment. The meeting was held in his house; he wrote the contract, hid the contract in his house and was the first one to be arrested for this action. May be no one else was ready to take all these risks but Mr. Hongchang did for the whole community of farmers in the area, shows leader like qualites.
Also, this collective action of the farmers has some but not all the features of a movement i.e. it can be claimed as a quasi movement by the farmers. It was a conscious collective action by the farmers who lacked organisational weapon but wanted to improve their economic condition i.e. bring about a change using non violent means secretively.

Rajeev said...
This comment has been removed by the author.
mayank tiwari said...

The story is of the period when Maoism was in full swing in PRC. CPC is effectively the only party in PRC. The steps taken by the farmers were different from the ideology of the state and their means were illegitimate according to CPC’s philosophy. They were bound to be repressed. But due to Mao’s demise and the problems faced by the state there were thoughts of certain economic reforms. These circumstances led to favourable response to the movement. But the core philosophy of CPC remained same and hence the outcomes in the last paragraph of the story.

Mayank Tiwari
32079

Chocodips said...

http://www.npr.org/blogs/money/2012/01/20/145360447/the-secret-document-that-transformed-china
I read the story from this link. Its indeed a great story. But again as the movements are extinct today, this one also comes from the 60-70s era, when there used to be movements. And it shows, how important ideology and consensus is in a collective. Any of the farmers could have given away the rest, as in prisoner's dilemma. But it didnot happen and people stuck on to each other.
-Bhavi Patel (32011)

Rohitash Jain said...

This case clearly shows-until and unless benefits are visible, collective action can’t become success that’s why more people join collective action after visualizing benefits. Same thing is happening with our loss making and ill government and public sector units. Neither there is mechanism for incentive for good work nor punishment for bad work. That is the reason our government department work is more routinized leading to rad tapism and delaying every work.
Rohitash 32088

Anju Lakra said...

It is a case which reveals that no collective action is fruitful if there is no personal gain. Xiaogang farmers also faced a similar situation where there actually was no incentive to work hard. But what interests more here is the role of Yen Jingchang, who took the initiative to bring a positive change. Though criticized initially, his ideology was taken up by the state and which eventually transformed the Chinese economy. Importance of leadership is quite visible here.
Anju Lakra
32004

Kamal Rangan said...

A perfect example of a radical collective action against the state ideology bringing in much better success which ultimately led to the strategy being adopted by the state also. But last paragraphs show how State desperately tried to recapture its control over people to uphold its philosophy fearing similar radical movements in other sectors also which would have led to weakening of State’s power. Examples like the capturing of profitable business of Hongchang, misguiding the media from freely interacting with the change agents (another example of Nobel laureate Liu Xiaobo) depicts the autocratic authority being practiced by the State
Kamal Rangan (32075)

Himanshu Bhardwaj said...
This comment has been removed by the author.
Himanshu Bhardwaj said...

This story indeed gives us insights on different aspects of collective action. First it tells us that a collective action can be more efficient and successful if individualism is also being considered. Personal gain is kind of motivation or the driving factor for any collective action to take place. Secondly it also tells us that sometimes though the state ideology may be different from the collective action but due to political conditionalite which the change in leadership here, the obvious outcome of suppression can change into acceptance of collective action as evident in this story.
Himanshu Bhardwaj
p32069

Tanu Shree Shekhawat said...

Sometimes the structure of the institution automatically converges individual behavior into collective action as apparent from this case. Monopoly of state over public domains gives rise to such methods just as bureaucracy in India has given rise to organised corruption practices. Such situations also give rise to policy changes and mobilization, as idea of Lokpal bill has emerged due to corruption.
Tanu Shree Shekhawat
(32044)

shashank- EXPLORING MYSELF said...

This example of collective action shows not only what has been done by Yen Jingchang but also the communist party officials. They didn’t seem to realise a very obvious fact that there is no incentive for a farmer to work and hence the production would be low .Instead they just blindly followed to the orders given to them till another collective action in form of economic reforms led by Deng Xaioping changed the process.

Shashank Singhania

Avanita said...

A person puts in serious efforts in any action, either in a group or individually only when he feels that he will derive some benefit out of it. The story throws light on various attributes associated with a collective action. Initially, there was no motive for the people so there was no hardwork from there side. As soon as the contract was drafted and people realized the incentives that they would get, a dramatic change in the output was observed. It also gives insights about how collective action when organized under a leadership can achieve great results.
Avanita
32058

mayank k said...

It is a case which proves the point that individualism is necessary for collective action.This case also shows that it is not necessary that if your ideology against the ideology of state you will not succeed.The model of the village was replicated by state in other parts.The last paragraph of the story shows that it is not necessary that the leader of the collective action will be benefited by the action on personal level
Mayank kashyap
32023

Prerna said...

This story reflects how egalitarianism alone fails to satisfy all the beneficiaries in a communist society. A stable balance between egalitarianism and utilitarianism is required in systems favoring benefits for all . Incentives given for the extra utilities provided motivate the producer to improve the productivity. Also ‘everybody’s responsibility is nobody’s responsibility ’- tragedy of the commons (there was never enough food in Xiaogang). This story also highlighted that under proper leadership, the power of weak can initiate a movement which can institutionalize if they find some support from the powerful authority .
Prerna Gupta (32030)

Kevin Parekh said...

It was an amusing read as it is the first example i have come across that is of a voluntary collective action against not complying to a forced collective action. The most primitive basis of communism being everyone collectively working to produce the collective wealth. Clearly the incentive to work hard is not there and so they did not. They realized and took the risk because they were going hungry and were pushed against the wall but still the understanding of human psychology displayed by the farmers is also amazing.
Kevin Parekh

Kevin Parekh said...

It was an amusing read as it is the first example i have come across that is of a voluntary collective action against not complying to a forced collective action. The most primitive basis of communism being everyone collectively working to produce the collective wealth. Clearly the incentive to work hard is not there and so they did not. They realized and took the risk because they were going hungry and were pushed against the wall but still the understanding of human psychology displayed by the farmers is also amazing.
Kevin Parekh

Pankaj said...

People collectively decide to stop owning/ working collectively :-)

Lets look at the failure of earlier collective action when farming was on communist lines. If the villagers children were going hungry, why did they not decide to work harder collectively on the whole farm, keep the excess produce for themselves, passing the rest to the government ?? This way they would have also avoided being on the wrong side of the prevailing government sentiment. What motivation did individual ownership carry when it did not even have any legal backing?? The only limited motivation I can see is that farmers got the freedom to work independently which they preferred - working collectively seems to have pulled everyone down.

Pankaj - 32082

Pankaj said...

Further, note to friends/ foes/ strangers who have commented above:

The language of the article, right from the title, is propagandistic in nature. My feeling is the event described in the article may very well have happened and everything else written may also be true but there is also lot of 'other' context known to the author of the article which he has consciously ignored. Why? To highlight his preferred view of the situation.

PRATEEK PARIMAL said...

This is a real interesting case which sheds light on the way a collective action is being performed. Earlier the Xiaogang farmers had no motivation to produce much even though they were doing it collectively. There was no incentive for them to produce more as the share of the collective action was diverted to someone who is not involved in the action. This concept of collective action is well understood by this story.
Prateek parimal(32029)

a said...

This is an apt example to demonstrate reasons behind failure of top-down collectivism in communist & socialist countries and change which a bottom-up approach can usher. Introducing an incentive structure in a system where people earlier functioned indifferently, h inefficiently leading to tragedy of commons and presence of a responsive leadership provided momentum to the turnaround experienced in China. The ideology adopted by farmers was radical, their means were legitimate and there was a transition need being felt at macroeconomic level. These factors contributed to an act of defiance being recognised as a replicable model.
Avinash Kumar
(32059)

Mahesh(p32019) said...

This is classic example which explores different aspects of collective action in managing common property associated with voluntary participation, input output quotas. Farmers of Xiao gang village were working without any incentive to work hard. But when they decided to have some incentive for working hard, village experienced higher levels of active voluntary participation and significant results. Also there was ideological difference between farmers and state. Earlier state considered means of farmers to be non legitimate but when they legitimise it because of outcomes and urgency of the moment, it become basis for Chinas economic transformation.
Mahesh Dharap (32019)

TOMARSHUBH said...

The most stark question which comes to my mind is why the chinese officials now are not promoting the farmer who was once a legendary figure in China?? Was he really the man of wisdom & courage or was it just because the officials let him show his courage? Since then, whenever he has started profitable businesses, it has been taken away by the officials? Is it that the communist's don't want to the bottom of pyramid entrepreneurship ventures to give way to high tax revenue generating indusustrialization?
Shubham Tomar
32093

Abhinav Deep Sinha said...

Same was the case with Soviet collective farming. People worked on huge collective farms apart from owning small plots of land themselves, usually no larger than a small garden attached to the house. The productivity at the state-owned farms was poor while the private lands returned bountiful harvests. It was rightly said that "garden farms feed the USSR". But this was never acknowledged by the state as doing so would liberate a large chunk of the population(farmers) and bring down the largest pillar of communist ideology ie the rights of farmers( the communist symbol is also comprised of farmers' tools).

Pavan EVSR said...
This comment has been removed by the author.
aditi said...

This piece of article clearly emphasizes the fact yet again that self-interest is the greatest driving force for materializing collective action. Also a sense of right needs to be attached to common property to extract it efficiently. Here in this case, when a clear incentive was given, in terms of self-consumption, the output as a collective increased. Also, a written contract was made although members were farmers who were familiar to each other. This brings out the importance of contractual safeguards in collective actions.
aditi(32052)

Deepak Sharma said...

From this article it can be seen that if profit motive is there for the individual he will work hard to achieve it. It also shows that humans by nature want to own things. For a collective action to be successful they need to have rational thinking.

Deepak Sharma
32013

Sameera Mushini said...

From The Secret Document that changed China , the following could be inferred:
1. Personal gain motivates people to work hard.
2. Involving participants on a higher level generates a feeling of belongingness, and results in better motivation
3. Gaining the same irrespective of the effort put in demotivates people.
4. Power is important to legitimate any issue.
I see full utilitarians here who contribute if and only if their contribution increases the average benefits.

Sameera Mushini
P32038