<P> In traditional Maoist organization of the rural economy and that of other collectivised programs, farmers were given by the government a quota of goods to produce . They received compensation for meeting the quota . Going beyond the quota rarely produced a sizeable economic reward . In the early 1980s peasants were given drastically reduced quotas . What food they grew beyond the quota was sold in the free market at unregulated prices . This system became an instant success, quickly causing one of the largest increases in standard - of - living for such a large number of people in such a short time . This system maintained quotas, and thus the element of socialist societies termed in China the "iron rice - bowl" (in which the state ensured food and employment). </P> <P> The secret experiment proved very successful . The famous example was that in Xiaogang village, Fengyang county, Anhui province (安徽 省 凤 阳 县 小 岗 村), where 18 households signed a contract with local cadres . The cadres secretly allowed farmers to produce by household and if the cadres were punished for this the farmers agree to take care of the families of the cadres . In 1979 similar experiments began in Sichuan and Anhui provinces, both seeing dramatic increases in agricultural productivity . Deng Xiaoping openly praised these experiments in 1980, and the system has been adopted nationwide since 1981 . </P>

Under the household responsibility system farmers in china