In the latter half of the 1990s, the South Korean government started consideration about a direct payment program (DPP) for LFAs, and officially put it into force in 2006. This paper, based on two cases of field research, examines the general situation of agriculture in LFAs and highlights the problems of the DPP.
　From the beginning, the DPP has been intended for two objectives: income support for farmers and the activation of the LFAs. As for income support, the effectiveness of the DPP has been disappointing. On the other hand, as for the activation, the DPP has been working well. It has really significant performance on the activation of LFAs through various joint activities.
　There is one contradiction between the reality and the DPP system. Due to the Agricultural Land Act, some part of rented lands is excluded from coverage under the grant program. To increase the effectiveness of the DPP, there must be further discussions on the role of the rented lands.

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　The transactions of rural China are self-enforceable without any perfect judiciary third party, because they are embedded in the informal social institution that is characterized as socially networked nepotism based on gift giving. A bilateral transaction such as labor exchange in a village is supported by the villagers' expressive network based on reciprocal gift exchange (li-shang-wang-lai). On the other hand, if villagers try to acquire resources in town, they utilize the instrumental network between village and town based on one-way gift giving toward the town (song-li). In any case transactions are self-enforceable, which is supported with the flow of gifts. The different manners of gift giving, that is reciprocal and one-way, result in the fact that the expressive network is not related to income level but the instrumental one is connected with income.
　First, we prove theoretically that the reciprocal and one-way manners result from rational conduct that minimizes the gift payment. After that, the following hypotheses led by theoretical analysis are empirically tested, that is, (1) A transaction is actually embedded in the expressive and instrumental network, (2) The reciprocal and one-way gift giving are inevitably executed, (3) The boundary between town and village actually exists, (4) The expressive network is not related to income level, (5) The instrumental network is connected with income. The first point is ascertained by the categorical regression analysis of questionnaires about socially networked nepotism in Beijing City. Analyzing household-level micro data for Hubei, Shandong, and Liaoning Provinces significantly proves the other four hypotheses.
　Of course, a society based on the formal judiciary institution is ideal. If the cost of transition from informal to formal institution is prohibitive, however, the present informal network based on gift giving is still adopted by farmers, because it is an intrinsically rational system.

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　This paper examines the role of social capital in a new environment conservation policy which aims at the conservation of the land, water and environment in rural regions launched in 2007. I focus on not only effects of bonding and bridging social capital themselves for it but an interaction effect of both types of social capital. I estimate these parameters while controlling other factors such as the geographic feature and production circumstances, treating rural communities as sample units. The empirical result certainly supports the presence of the interaction effect of them. This is a highly suggestive result; a plenty of bonding social capital can enhance the performance of bridging social capital for this new policy, and vice versa. Moreover, from the perspective of the accumulation, the negative correlation between bonding and bridging social capital is found. As a result, considering all of the above, the balance of the accumulation of both types of social capital is found to be the key for this new policy.

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