ABSTRACT
The interrelations among agricultural prices, production costs, and farm income constitute one of the most urgent economic issues facing agricultural economists today, whether in China or abroad. Applied research on the subject in recent years has yielded divergent findings and points of view. Rather than adding to this already-rich empirical experience, the present chapter attempts to focus on how the economic mechanism underlying price-, cost- and income-movements operates to guide farmer behavior in the uniquely mixed economy of Mainland China. By tracing how the farm sector has navigated its way through the economic reforms of the 1980s, we shall endeavor to shed light on agricultural practices in China.
