Business History of Modern China
October 3, 2025
Now, evil, idle sons—sell the land! . . . It is the end of a family—when they begin to sell the land . . . Out of the land we came and into it we must go—and if you will hold your land you can live—no one can rob you of land. . . . If you sell the land, it is the end.
When did it start?
Has it really ended?
China
World
The inability of rich men to invest their money in land will automatically equalize land ownership and will prevent these equalized land rights from becoming unequal. In addition to enforcing this policy, the Government should also take the necessary measures to finance agricultural production, adjust the prices of farm products, and improve agricultural techniques and the farmers’ livelihood. In this way, the land problem will be solved. Once the land problem is solved, commercial capital will no longer be invested in land, but will be invested in industry instead.
How to decide the fate of these four individuals?
Context:
Roles:
“In short, if poor countries are to become rich, then the equitable division of land at the outset of development is a huge help. Japan, Korea and Taiwan put this in place.”
Both the PRC in Sunan and the ROC on Taiwan launched successful land reform campaigns in the early 1950s. But there were many similarities and differences.
Similarities:
Differences:
| Country | Main measures | Key actors | Outcomes / impact |
|---|---|---|---|
| Japan | Issued private land titles, fixed cash taxes; post‑WWII 3-hectare cap plus rural support (credit, extension, marketing) | Meiji government; Ministry of Agriculture; Allied Occupation / GHQ (SCAP) | Rice production roughly doubled from Meiji to WWI; rice increase ≈+50% after war |
| Taiwan | Selling off confiscated land from Japanese owners; land reform law in 1953; limit to 3 hectares; investments in infrastructure, services, and marketing, etc. | Nationalist government; Joint Commission on Rural Reconstruction (JCRR); Ministry of Agriculture; US aid programs | Agriculture yield increase (~50%) enough to provide food, employment, and forex |
| Korea | Land reform law 1949; 3-hectare limit; | US Army Military Government in Korea (USAMGIK) and subsequent ROK government (Syngman Rhee era); Ministry of Agriculture; local land‑reform implementing bodies | More centrally managed and less farmer participation; large amount of land sold outside formal process |
Small-scale household agriculture in east Asia led to a 50-75% increase in food production in the first 10-15 years after land reform. Why?
Increased agricultural output created ideal competitive conditions, boosted rural consumption, driving demand for consumer goods and helping export-driven economies.
Maximizing agricultural output reduces the need for foreign exchange spending on imported food, freeing up resources for technology imports.
Household farms provide a crucial welfare role in poor countries lacking unemployment benefits, preventing widespread poverty and squatter camps seen in nations with large-scale farming.
Redistributing land was only the first step.
Land reform:
Forcibly buy up tenant farms from landlords and give it to the tenants; this increases farm productivity per unit of land area, gives rural people more to do, pushes landlords to cities to start more productive businesses.
Export discipline:
Push companies to export instead of just selling domestically. Cut off support to companies that try to export and fail.
Financial control:
Push banks to support exporters instead of putting their money into real estate bubbles and the like.
The CCP radically suppressed the elite and fostered mobility. However, even the Communist Revolution failed to reverse socioeconomic status beyond one generation. Why?
Cultural capital:
Sociologist Pierre Bourdieu: Non-financial social assets – like knowledge, skills, education, and cultural tastes — that influence a person’s status and opportunities in society.
Forms of cultural capital:
Embodied (personal traits and knowledge), objectified (cultural goods like books or art), and institutionalized (qualifications or credentials).
What’s distinctive about post-Mao China
The resurgence of the elite is not due to land inheritance or formal education, but non-school human capital and family- and kinship-based social capital.