Research On Agricultural Product Circulation Model Based On Farmers

The circulation of agricultural products is not only related to the basic interest of the tens of millions of dispersive farmers and daily life of urban residents, but also to the basic welfare of a large number of practitioners in the intermediate links of it. The characteristics of the circulation of agricultural products which connect the production and consumption of agricultural products (food) make it play a decisive role in the resolution to strengthen the control of food safety and the "three agricultural problems". The model of agricultural products circulation is an important issue and the key link of it. In China, the reality is that large numbers of scattered farmers directly involved in agricultural production and circulation. It makes the research and explore about the model of agricultural products circulation based on the perspective of farmers have very important theoretical and practical significance.Based on the reality of Chinese agricultural small-scale decentralized management, this study combed the course of circulation system reform of bulk agricultural commodities (grains and cottons), fresh agricultural products (fruits and vegetables) and relevant products of meat and eggs since1949, and had a systematic exposition about the historical evolution, status characteristics and future directions of Chinese agricultural products circulation system. According to the definition of the connotation of agricultural products circulation model, this study constructed the analytical framework of agricultural products circulation model based on the farmers' perspective. And then using the appropriate econometric model and based on the survey data, it did an empirical study on agricultural products circulation model from the perspectives of transaction costs and farmers welfare. Particularly this study also discussed the distribution of surplus of "Farmer-Supermarket Direct-Purchase" which is the agricultural products circulation mode that takes cooperatives as the core. Based on the empirical findings, this study proposed some policy recommendations to promote farmers' participation in the modern agricultural products circulation model.The main findings and conclusions of this study include:1. The study analyzed the historical evolutional course, current characteristics and future directions of the agricultural products circulation system in China. It carried out a systemic review on the evolutional course in the agricultural products circulation system including bulk agricultural commodities (grains and cottons), fresh agricultural products (fruits and vegetables) and relevant products of meat and eggs. Grain, cotton and other bulk agricultural commodities had gone through the free purchase and sale system stage, the unified purchase and sale stage, unified purchase and sale change and market trial stage, and the process of marketization under the guidance of the government. Other fresh agricultural products (fruits and vegetables) had gone through a short stage of free purchase and sales system, a plan circulation stage in which most business was did by the state-owned commercial enterprises, the stage in which government only manage the big production and sales, order and exclusive sales stage and the free market circulation stage. Meat and eggs has gone through the stage in which free purchase and sales played the main role, the government assigned purchase stage, the transition stage in which the plan regulation changed into market regulation and the free purchase and sales stage. Moreover, historical development, current characteristics and future direction have been illustrated systematically in the circulation system of agricultural products in China. Attention is drawn mainly on the components and characteristics of circulation system of agricultural products under control of planned economy system, current marketization and future modernization.2. Based on farmers' perspective, this study discussed the content and type of on the agricultural products circulation model, and did an empirical study on the comparison and selection of agricultural products circulation model from the perspectives of transaction costs and farmers welfare.(1) Based on the Multinomial Logit model and regression multiple model this study analyzed the impact of transaction costs for farmers to select the mode of agricultural products circulation. The findings showed that:â‘ In view of transaction cost savings, the farmers entering the market in group could be benefited to protect and enhance the interests of farmers. But there are significant differences about the transaction costs among different circulation models. Overall, the transaction costs from low to high were cooperatives, agricultural technology association, leading enterprises, plantation, brokers and individual farmers.â‘¡Farmers own characteristics had a significant impact on their selection of the way of agricultural trading. And the different characteristics had different influence. The farmers' characteristics had different degree of influence to different transactions.â‘¢Transaction costs are the main factors that influence the selection of the way of farmers agricultural trading, but for different transactions of agricultural products, information costs, negotiation costs, implementation costs and transportation costs showed a different influence.(2) Based on Sen's capability Theory, using fuzzy mathematics method, the study compared the welfare effects of the farmers in the different models of agricultural products circulation. The findings showed that:There are some significant differences about the level of farmers'welfare in different ways of agricultural products transaction. This study examined six kinds of agricultural products transaction in which the farmers'welfare were in three significantly different levels. Welfare of the farmers in the "individual farmers+market" transaction and the "farmers+leading enterprises+market" transaction were in a low level. Welfare of the farmers in the "plantation+market" transaction and the "farmers+brokers+market" transaction were in the fuzzy state. Welfare of the farmers in the "farmers+cooperatives+market" transaction and the "farmers+agricultural technology association+market" transaction were in a high level.3. Particularly this study discussed the distribution of surplus from cooperatives to farmers in the "Farmer-Supermarket Direct-Purchase" agricultural products circulation mode. The study concluded as follows:â‘ The main reason for which the farmer cooperatives' surplus distributions were not enough was that the management system of farmer cooperatives is imperfect, cooperative managers and ordinary members don't have high capacity.â‘¡Part of the cooperatives had defects in the organization and operation mechanism. These led cooperatives' earnings distribution is not open and opaque, and the proportion of surplus return was low, the effect of income improvement of farmers who through cooperatives to participated in the "Farmer-Supermarket Direct-Purchase" is very limited.â‘¢Coordination and distribution mechanisms of interests between cooperatives and the enterprises members were not clear. The situation was that the enterprises members controlled cooperatives.â‘£Different types of farmer cooperatives show significant differences in the surplus distribution. The best one is the cooperatives that purely spontaneous joint by farmers, followed by cooperatives that develop from the self-employed households (large ones), cooperatives that develop around the agents, and cooperatives that base on contract operation. Cooperatives that have enterprises members make the worst performance.Innovative points of the paper can be listed as followings:(1) the innovation on research views. Using tow different approaches and from tow different perspectives (transaction costs and farmers' welfare), this study researched on the agricultural products circulation model. There was no doubt it opened a new research horizon.(2) The innovation on research method. The paper adopted an empirical study. Especially, a fuzzy evaluation model was constructed and applied to evaluate farmers' welfare in different circulation models based on Sen's capability theory. The method brought in an innovative concept in researching the agricultural products circulation.(3) The innovation on research content. This study compared transaction costs and farmers' welfare in different agricultural products circulation models. Particularly this study discussed the distribution of surplus from cooperatives to farmers in the "Farmer-Supermarket Direct-Purchase" agricultural products circulation mode. Therefore, creative elements were injected into the content.