Mao Zedong's successful strategy for the Chinese Communist Party in the civil war was based on the building of political support and strength in rural China – on ‘surrounding the cities from the countryside’.

The first revolution in the Chinese countryside was the land reform implemented in the ‘liberated areas’ and extended throughout China after the proclamation of the People's Republic in 1949. This was important in the consolidation of the Communist Party's political power. It was associated with early gains in agricultural production as order was restored to a war-torn economy, but these were swallowed up by the effects of the forced collectivisation of agriculture that gathered pace through the late 1950s.

The second revolution was the decollectivisation of agriculture and the shift to the household responsibility system as a basis for agricultural production. This was initiated locally in poorer provinces (Anhui and Sichuan), and generally sanctioned by the Central Committee from 1981. The household responsibility system spread rapidly throughout China as its success in raising productivity was demonstrated in the early 1980s.

The phenomenal increase in Chinese agricultural output from 1978 to 1984 resulted partly from the new system of production and partly from large increases in the relative price of grain and other food at this time. The growth in farm incomes was encouraged by the expansion of opportunities to sell a proportion of output at higher prices on local markets rather than to the state, as well as by opportunities to specialise and diversify production according to local comparative advantage.