Since implementation of the economic reform and “open to the world” policy in 1978, China’s agriculture production system has fundamentally changed from a system of collective responsibility to one of family responsibility. This has greatly enhanced farmers’ initiatives, and agricultural production has grown tremendously: grains production rose from 304.77 million tons in 1978 to 442.66 million tons in 1992. As the increase in population during 1978-1992 was approximately 200 million (from 970 million to 1.17 billion), the national average of per caput grain production increased from 314kg to 378kg. Simultaneously, urban and rural income have been growing. Urban household income in 1978 was 316 Yuan RMB per caput, and 1,826 in 1992-a deflated increase of 228%. Rural household income was 133 Yuan RMB in 1978 and 784 Yuan RMB in 1992-a 328% increase.