Do cooperatives exclude small-scale farming households? Evidence from Fuchuan County, Guangxi Province.

The exclusion, or otherwise, of small-scale farmers by cooperatives determines whether they can be well engaged in the grand strategy of agricultural modernization. By identifying the exclusion pattern of cooperatives and using the field research data on farmers in Fuchuan, Guangxi, this study finds that cooperatives tend to screen their members via both explicit and implicit exclusion and that small-scale farmers are more likely to be excluded. The theoretical analysis conducted in this study reveals that excluding small-scale farmers is a rational choice made by cooperatives to pursue efficiency in the context of organizational form variation. Furthermore, cooperatives' organizational form variation and their decisions to exclude small-scale farmers are endogenous, thereby suggesting that cooperatives in China may become unions of rural elites. During the exploration of using cooperatives as a carrier to involve small-scale farmers in agricultural modernization, the phenomenon of cooperatives' exclusion of small-scale farmers needs to be highly emphasized.