To Revive Rural China, Local Governments Must Support Village-level Services
A village near Lishui, a city in Zhejiang province, China. Photo courtesy of Lishuilynn.
A Journey to a Faceless Village
Along the bed of the Tuan River in northern China, a lone dredging arm affixed to a sluggish boat scrapes away at sediment and raises minerals up to the surface. Across the river, beyond a field of tree stumps and brick facades, stubby snouts slurp animal feed from a trough underneath a wooden sign that reads, “The Liang Village Pigpen Imparts Knowledge and Educates the People.” The surrounding area is nearly devoid of life, populated only by a few shrubs and wizened trees leaning over cement roads.
The dredging arm and hungry pigs belong to the villagers of Liang, a small rural township in Hebei province. Liang’s mineral dredging business brings in money to sustain a village pigpen—previously an elementary school—and an assortment of deteriorating houses cut through by an eerily empty multi-lane expressway. Smaller debris-caked roads snake through the abandoned village center. In 2010, Chinese author Liang Hong characterized the town in her book as “unknown within China, just one among countless villages like it.” The book was a hit, selling more than a quarter of a million copies in China and securing an English translation: China in One Village: The Story of One Town and the Changing World. The title is a telling description of rural China’s struggle to keep up with China’s urban regions.
Once-burgeoning villages like Liang are becoming obsolete while cities are growing rapidly. Young students, workers, and hopeful entrepreneurs have been leaving their villages en masse, seeking employment and superior service benefits in cities. As of 2023, 292 million people had left their rural hometowns for China’s cities. Often, former villagers are contracted for migrant jobs, and only a few—those who can’t hold down a competitive job, or whose entrepreneurial ideas fail—return to their hometowns and take up local jobs.
Rural villages’ sustained economic growth once represented the pinnacle of grassroots growth in China. However, rural development is slowing down, in part because differences between urban and rural access to social services make it impossible for rural areas to convince their villagers to stay and grow their local industries. The rural-urban service divide is a result of the hukou or “household registration” system. Under this system, government healthcare, education, and other social services are readily provided for urban hukou holders. Rural villagers instead receive mostly localized service benefits—often paling in comparison to urban services offered to hukou holders—from elected committees called villagers’ committees.
The hukou system places an upper limit on service availability and rural wealth. Villages can’t break past the boundary set by hukou, which is causing a mass exodus of villagers seeking employment. In 2020, according to the Ministry of Public Security, 26.6% of the Chinese population consisted of migrant workers who left deteriorating rural locales for contracted work and urban-style services in cities. As of 2022, that percentage expanded to 33.7% of China’s total population. These migrant workers leave their village industries without a sufficient labor force, which renders the central government’s frequent attempts at encouraging rural manufacturing less effective than they could be.
To solve this problem, the Chinese central government should support the rural social services structure with local government funding and decrease the power that villagers’ committees have over rural services. Improving the services sector using local government funds can stop the flow of migrant workers by balancing the benefits available in rural and urban areas, supporting rural industries, and providing more jobs as these industries resume growth. This will cultivate rural labor and economic activity, helping to renew villages that might otherwise become ghost towns.
Hezhai, the Birthplace of Rural Villagers’ Committees
Not all villages are like Liang. Hezhai, a mountain village in the Guangxi Zhuang Autonomous Region, is highly praised as the birthplace of the modern Chinese rural governance system. In 2021, the Guangxi provincial government released a short written account of the pioneering Zhuang villager and CCP member, Wei Huanneng, who in 1980, fed up with crime, deterioration, and social disorder, founded the first self-governing villagers’ committee.
Wei’s committee was an enormous success. It transformed Hezhai into an economic powerhouse thanks to centralized directives mainly focused on developing infrastructure and services using the village’s existing resources. The directives also redistributed intra-village employment and imposed standardized village-specific criminal fines. As a result, the per capita income of Hezhai’s farmers increased over 3,500% from RMB 67 ($8) in 1980 to RMB 2,432 ($293) in 2003. Guangxi-based reporter Zhang Li touted Hezhai as a “once-backward village [that] became the birthplace of grassroots self-governance in China.”
After Hezhai and other villages instituted villagers’ committees, they were written into law under Deng Xiaoping, former leader of China, in the 1998 Organic Law of the Villagers’ Committees of the People’s Republic of China (or Organic Law of Villagers’ Committees). According to the laws, their service responsibilities lie mainly in three areas: infrastructure services, quinary services, and mediation services. However, Article 22 of the law contains a statement that expands coverage to “other matters that involve the interests of the villagers and that all the villagers are concerned about,” which means that both public and private services are fair game for committee oversight.
Despite their success a couple of decades ago, villagers’ committees have started to hinder rural growth. The root of this problem lies in the fact that services depend on village assets and villagers’ willingness to cooperate with mutual aid initiatives. Xiang Jiquan, a professor at Central China Normal University, argued that “villagers are used to spending the village’s accumulated financial funds in dealing with the village-level welfare undertakings, the social management and public services, which should be undertaken by the Central Government of China.” Rural public services, in other words, should not be point-like, with one sector per village that is overseen by that village’s committee, but more sheet-like, a blanket of inter-village services overseen by local governments.
In contrast to villages, urban areas provide a common high standard of state-run services for permanent residents built on a robust public services system including schools, public housing, pensions, hospitals, and healthcare. As young people move out to cities, the aging village population is reliant on villagers’ committees to use mutual aid resources for assistance. However, each village has different resources to the next, such that some elderly villagers are not aware that social security, which might be commonplace in a neighboring village that can fund it, exists. Services that are typically both public and private, like foodservice and mediation, are also more available and of higher quality in cities.
Supporting Rural Services by Shifting Local Government Priorities
Li Ying at the Sichuan Academy of Social Sciences has suggested that changes to the system of villagers’ committees might shrink the urban-rural services gap. According to Li, villages should improve service capabilities, cooperate with external services organizations, and strengthen the construction of public services systems and public cultural services.
Part of Li’s solution requires central intervention or a shift in local government priorities. Remember that seldom-used expressway snaking through the formerly scenic Liang landscape? The expressway is a result of excessive infrastructure funding. As an alternative to funding these projects, local governments could consider replenishing services-oriented implements like schools and healthcare facilities. Governments can fund services using allocated stimulus in the short run and reallocate budget priorities from focusing on investment to supporting the services economy in the long run. This policy change would align with a much larger central government plan to shift local government priorities away from infrastructure and real estate finance.
Because the Organic Law of Villagers’ Committees was revised in 2010 to allow local government branches to handle affairs that supersede the boundaries of the single village, Li’s suggestion to centralize services decisions under local government authorities is practicable. Once social services availability is boosted, urban-quality private services can also trickle into villages.
For instance, if people’s mediation (civil, non-judicial mediation) is removed from the Organic Law of Villagers’ Committees, villages can create services markets for fully private mediators who are held to the standards of the 2011 People’s Mediation Law. The same shift is applicable to the “other matters that involve the interests of the villagers and that all the villagers are concerned about” in Article 22. Therefore, cutting the power of villagers’ committees while creating a government-guided pathway for consumer-dependent private services enterprises to fill gaps in services will bring rural villages closer to urban areas.
The market for large-scale, inter-township services programs, contingent on weakening villagers’ committees’ grips on services, consisted of 28,399 villages containing 70.5% of China’s population in 2017. Villagers who benefit from state-installed public services will engage in the private services market, driving consumption and growth, and revitalizing industry.
Furthermore, since the relationship between services and manufacturing is reciprocal, public services and a robust private services sector will encourage manufacturing and consumption. This requires a shift away from the “misconception that services are virtual while manufacturing is real,” a point raised by former Chinese Vice Minister of Commerce Yi Xiaozhun at the China International Fair for Trade in Services in 2023. Services can form the basis of a return to rural economy development initiatives promoted by the Central Committee of the CCP and the State Council on February 3, 2024.
Reviving Rural China
If rural services and urban services were pitted against each other, urban services would be the guaranteed winner. Similarly, urban manufacturing jobs are more sought after than rural manufacturing jobs. Even though some workers, especially the elderly, might be content to stay in their villages, the rural-to-urban migrant population continues to grow in part because of the systematic divide between rural and urban services.
The hukou-induced difference between rural and urban areas has contributed to a rural-urban gap in economic activity. The present argument does not advocate directly closing the hukou-induced wealth gap, which is unrealistic. However, relying on villagers’ committees to manage public services is problematic because individual villages often lack resources to sustain adequate services sectors without external help, leading to services inequality. Instead, a more centralized, local-government funded public services sector offers a path to reform that is concerned not with shifting the rural population to urban locales, but instead providing services support that encourages villagers to stay or return after leaving, reviving the village’s industry and identity in the process.
Ethan Kuperman (CC ’27) is a staff writer for CPR planning to study East Asian studies. He is interested in Chinese history and politics, globalization, and economic policy.