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George Hendrikse and Li Feng

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Xiangping Jia, Yamei Hu and George Hendrikse

In recent years, China’s government promoted the emergence of Farmer Professional Cooperatives (FPCs) and anticipated restructuring the production system of agriculture through larger-scale operations more like those in Europe or America. Notwithstanding the immense initiative, there is insufficient knowledge about how this changes the governance of farmer cooperatives at the local level. Based on a national survey conducted in 2009, this chapter shows that decision-making of production and marketing within FPCs in China is retained by individual farmers. However, the decision rights of farming are decomposed into input procurement, output marketing, and production. While the rights regarding production stay with family farms, the decision rights regarding input purchase and output marketing tend to be committed to FPCs. The governance structure of FPCs presents hybrid forms of both hierarchy and family farming. The study also finds that product attributes (such as perishability, marketing frequency, and branding), heterogeneity of the membership, and agribusiness policies affect the decision rights within the FPCs in China.