Agricultural Reform and the Household Responsibility System
How a secret experiment by desperate farmers in Anhui province launched the most consequential agricultural reform in modern history.
The Secret Pact of Xiaogang Village
In November 1978, eighteen farmers in Xiaogang village, Fengyang county, Anhui province, gathered in a dirt-floor hut and signed a secret agreement. They divided the village's communal land among individual households, with each family responsible for its own plot. Any output above the state quota could be kept or sold by the family. The farmers knew this violated Communist Party policy on collective agriculture, so they added a clause: if any signer was imprisoned or executed, the others would raise his children.
Under Mao's collective farming system, Xiaogang had been so unproductive that villagers regularly went hungry. The commune system destroyed incentives: whether you worked hard or barely worked at all, you received the same share. The result was predictable. Grain output stagnated, and rural China — home to 80% of the population — remained desperately poor.
The results of Xiaogang's experiment were dramatic. In 1979, the village's grain output was larger than the previous five years combined. Farmers who had barely fed their families suddenly had surpluses to sell. Word spread to neighboring villages, and the practice of household farming began to replicate across Anhui province.