China's rural industry: structure, development, and reform

The emergence and recent rapid growth of rural nonagricultural enterprises (township, village and private enterprises - TVPs) in China is a striking and in many ways unique phenomenon. Almost overnight, industrial activity has expanded tremendously and enterprises have proliferated. These changes have brought about large increases in rural personal incomes and significant shifts in the structure of the rural labor force. The goal of this report is: (a) to present a better understanding of how China's industrial TVP sector actually functions; (b) to present information about the rural communal institutional and regulatory framework within which it operates; (c) to ascertain the reasons behind the rapid growth of the sector, particularly since 1984; (d) to identify and analyze the problems and obstacles faced by the TVP sector as it continues to evolve and develop; (e) to evaluate on an informed basis different institutional and policy options for the future; and (f) to shed light on the TVP sector from an international perspective. Finally, it is noted that China's TVPs have already become a pillar of the country's economy and are playing a decisive role in rural industrialization and national economic modernization.