Household responsibility system

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The household responsibility system (simplified Chinese: 家庭联产承包责任制; traditional Chinese: 家庭聯產承包責任制; pinyin: jiātíng liánchǎn chéngbāo zérènzhì), or contract responsibility system, was a practice in China, first adopted in agriculture in 1979 and officially established in 1982 during the early phase of Reform and Opening, by which households are held responsible for the profits and losses of an enterprise. This system, which came to replace collective farming, maintained public ownership of land and some of the means of production, but made production the responsibility of households. Households still had to contribute to state quotas but could make their own decisions about what to plant on contracted land and could sell via a multi-tier price system that included the lowest price for payment to the state up until the quota, a higher rate for above-quota sales to the state, and market price for crops allowed to be sold at fairs.