In this paper, we directly investigate the effects of market development on farm household hog production. In Section 2, we document the ways in which market developments appear to correspond with observed trends in household hog production, and we discuss our data. In Section 3, we provide a theoretical explanation of the linkage between markets and household hog production. In Section 4, we econometrically estimate the effects of labor and grain market developments on household hog production. The results indicate that market development can explain the dynamics in China's backyard hog sector. Section 5 summarizes our findings and draws policy implications.