Over the past 30 years China s intensive agricultural production and nitrogen overuse has led
to significant environmental problems. Moreover farmers face uncertainty regarding better
technologies since they are risk-averse due to the experiences they have made in the past. Thus
the challenge to overcome is to implement well-grounded approaches that accomplish effective
agricultural training encouraging farmers to adopt optimised practices. Since in addition to
economic concerns successful local policy implementation is closely related to an individual s
social and cognitive preferences the approach of this study was to link the
socio-psychological theory to the economic model of individual behaviour. Tailored to the
Chinese context in particular farmers agri-environmental attitudes their fundamental value
positions and personal gu nxi relationships are focussed in order to show how the mental
decision-process is related to the cultural institutional and historical context. Empirical
evidence was gained by a comprehensive survey in Shandong Province. The results provide an
overview of the economic environmental and structural situation of Chinese agriculture.
Besides excessive nitrogen overuse and low production efficiencies decreasing profitability
reveals the poor environmental and economic situation of small-scale farms. As a result of
increasing opportunity costs for labour in particular of young family members farms diversify
their income strategies. Overall Chinese agriculture lacks better structural conditions and
future perspectives as well as the support of effective extension systems with well-educated
trainees. Hence policy recommendations are proposed in the fields of education political
incentives and institutional reforms challenging a new agricultural paradigm for China.
