Abstract
It has been acknowledged in the literature that productive efficiency in grain production in China has substantially improved in the post-reform period, particularly in the early 1980s. Since then, there have been several policy changes in China, which have affected the growth of the sector. Specifically, the spectacular growth of rural industries has attracted significant physical and human capital from agriculture. It is in this context that Brown's warning of China soon becoming the world's number one importer of grain has raised an important question of whether China has reached its grain production potential. Analysis of the 1994 farm household survey data indicates that the majority of the sample farmers is reasonably technically efficient in grain production but that productivity can be increased further even with the existing technology.
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