LAND AND PEASANTS IN LATE IMPERIAL CHINA: AN ECONOMIC ANALYSIS by He Yang A Dissertation Submitted to the Graduate Faculty of George Mason University in Partial Fulfillment of The Requirements for the Degree of Doctor of Philosophy Economics Committee: ___________________________________________ Director ___________________________________________ ___________________________________________ ___________________________________________ ___________________________________________ ___________________________________________ Department Chairperson ___________________________________________ Program Director ___________________________________________ Dean, College of Humanities and Social Sciences Date: _____________________________________ Spring Semester 2013 George Mason University Fairfax, VA Land and Peasants in Late Imperial China: An Economic Analysis A dissertation submitted in partial fulfillment of the requirements for the degree of Doctor of Philosophy at George Mason University By He Yang Master of Arts Wuhan University, 2006 Bachelor of Arts Wuhan University, 2003 Director: John V.C. Nye, Professor Department of Economics Spring Semester 2013 George Mason University Fairfax, VA Copyright 2013 He Yang All Rights Reserved ii DEDICATION This is dedicated to Professor Yoram Barzel who gave birth to my intellectual life. iii ACKNOWLEDGEMENTS I would like to thank the following people who made this possible: my adviser John V.C. Nye, and the members on my dissertation committee: Alex Tabarrok, Carlos Ramirez, and Colin Lixin Xu. I would also like to thank those who inspired me in the process of my dissertation: Justin Yifu Lin, Kang Chao, and Mark Koyama. The Economic History Association provided funding for my dissertation research. My husband, Tianyang Xi, has been the most helpful and supportive person in my research. iv TABLE OF CONTENTS Page List of Tables……………………………………………………………………………v List of Figures…………………………………………………………………………..vi Abstract................................................................................................................……..viii 1. Chapter One：Introduction ....................................................................................…1 2. Chapter Two................................................................................................................4 Introduction .................................................................................................................4 Historical Background ...............................................................................................7 Literature .....................................................................................................................9 Theory .......................................................................................................................12 An Empirical Test: Dual Landownership on Confucius's Manors ...........................18 Conclusion ................................................................................................................25 3. Chapter Three............................................................................................................36 Introduction ...............................................................................................................36 Historical Background ..............................................................................................40 Data ...........................................................................................................................43 Main Empirical Hypothesis ......................................................................................52 Estimation Results ....................................................................................................55 Conclusion ................................................................................................................61 4. Chapter Four .............................................................................................................66 Introduction ...............................................................................................................66 Historical Background ..............................................................................................69 A Tiebout Model of Serfdom ....................................................................................73 Discussion .................................................................................................................78 Conclusion ................................................................................................................83 Bibliography ...................................................................................................................84 v LIST OF TABLES Table Page 2.1 Inequality of Effective Tax Rate between Social Classes ................................……28 2.2 Inequality of Land Tax Rate between Urban and Rural Areas in Fujian Province ..29 2.3 Transaction of Manorial Land of Confucius's Lineage in the Qianlong period .......29 2.4 Land Donated to Confucius's Lineage in the Jiaqing Period ...................................29 2.5 Sample Size ...............................................................................................................30 2.6 Cropping System Statistics .......................................................................................31 2.7 Summary Statistics....................................................................................................32 2.8 The Probability of Dual Ownership on a Plot ...........................................................33 2.9 The Probability of Dual Ownership on a Plot: Bivariate Probit ...............................34 2.10 Robustness Check ...................................................................................................35 3.1 Mean Crop Characteristics ........................................................................................48 3.2 Major Aggregate Shocks in Qufu, 1759 - 1901 ........................................................50 3.3 Changes in Plot Size over time .................................................................................51 3.4 Changes in Plot Size over time .................................................................................53 3.5 Main Hypotheses ......................................................................................................54 3.6 Probability of Sharecropping versus Fixed Rent ......................................................56 3.7 The Probability of Sharecrop: Bivariate Probit Model .............................................60 vi LIST OF FIGURES Figure Page 2.1 The ratio of plots under dual ownership in the 1930s, by province.........................27 3.1 Map of Qiwang Village, 1787..................................................................................63 3.2 Grain prices, 1759 - 1901.........................................................................................64 3.3 Percentage of Crops before and after the Adoption of Double Cropping................64 3.4 Percentage of Share Contracts and Fixed Rent Contracts........................................65 vii ABSTRACT LAND AND PEASANTS IN LATE IMPERIAL CHINA: AN ECONOMIC ANALYSIS He Yang, Ph.D. George Mason University, 2013 Dissertation Director: Dr. John V.C. Nye The dissertation is organized around a common theme, the institutions of serfdom in late Imperial China. The dissertation consists of three chapters that investigate the following questions: 1) How did the structure of land tax determine landownership? 2) How did land tenure evolve in response to external changes in agricultural technology? 3) How did the competition for corvée labor between local governments and private landlords shape serfdom? The first two chapters examine serfdom from the new institutional economics perspective, studying contractual arrangements between the landlords and the serfs within a manor. The third chapter studies serfdom from the public choice perspective, discussing the fiscal interaction between local governments and private landlords. 1. INTRODUCTION The dissertation is organized around a common theme, the institutions of serfdom in late Imperial China. The first two chapters of the dissertation examine serfdom from the new institutional economics perspective, studying contractual arrangements between the land- lords and the serfs within a manor. The third chapter studies serfdom from the public choice perspective, discussing the fiscal interaction between local governments and private landlords.The dissertation tries to connect the literature of new institutional economics and the literature of public choice. The first chapter discusses a voluntary contractual arrangement between landlords and dependent tenants under dual landownership in late Feudal China. Under dual landowner- ship, landlords became subsoil owners and tenants became topsoil owners. Dual landown- ership emerged when serfdom was declining. During this period, peasants were no longer bound to land and had partial ownership (topsoil right) of land. However, they still had obligations to provide monetized corve (ground rent) to their landlord. Social inequality w- reflected in the tax rate differentials between the peasants and the gentry. I hypothesize that dual landownership acted as a tax shelter for heavily taxed peasant households who colluded with lightly taxed gentry households to maximize the value of land. In the later