Abstract: In order to evaluate the performance of the Chinese Farmer Specialized Cooperative, investigate its effectiveness and study the influential factors, based on the reality of the development of cooperatives in China, this paper rebuilt the cooperative performance evaluation index system, verified it with factor analysis method, and measured the practice cooperatives' performance. According to the measurement results, it used the SEM to analyze the effect of internal and external institutional arrangements to the cooperatives' performance and found that property right system was the fundamental factors to affect performance. In the background of China's cooperatives' special process of formation and its serious lack of support from cooperative culture, whether there has been built a set of internal incentive mechanism in which institutional property rights, responsibilities and interests are clear, with matching internal incentives will have a significant positive impact on the performance of cooperatives. Besides, a sound governance structure, relative institutional arrangements, a disclosed financial and operating situation, and support from the state or financial sector etc., also have outstanding influences.