A Study On Operating Mechanism And Development Route Of China's Agriculture Industrialization

The reform brings the new energy to the agriculture and the rural economy, promotes the increased income of peasants, speeds up the adjustment of agricultural structure, and improves the rural productivity. However, compared with more modern industry, either the production or operating mode of the agriculture, poses a relatively backward status and the foundation is still fragile. And, with the deepening reform and opening up, the small production with the family as the unit and domestic & foreign markets, small-scale running of peasants and large-scale socialized production, the traditional mode of agricultural production and modernization of agriculture contradict with each other more and more seriously. In order to solve these problems, some areas gradually explore the road to industrialized operation of agriculture.Agriculture industrialization is the necessary consequences that productive forces develop into a certain stage, it is the fundamental access to solve the contradiction between small production and big market; It is a strategic initiative to increase peasants'income; It is an important means to promote the integration between urban and rural areas and the surplus labor transfer of rural areas; It is an important means for the traditional agriculture to develop to the modern agriculture; It is an important driving force to enhance the degree of organization of peasants.The agriculture industrialization, as a mode of agricultural production organization from the practice, its emergence and development has a certain objective necessity. From the view of the labor division of theory, the growth power of the agriculture industrialization derives from the continued division of labor within the agricultural industry, then the division of labor process deepen, that is, the functions of peasants continue to divide, then the process differentiate further, which gets longer and extends in the agricultural industry chain; from the view of industry economic theory, the agriculture industrialization can improve market competition structure of farm products, optimize the market behavior of agricultural producers and operators, enhance the performance of agricultural markets effectively; from the perspective of economies of scale, the agriculture industrialization can get economic benefits of internal scale economy brought from rational organization, division of work and professional production, and gain economic benefits of external scale economy through the trades; from the view of transaction cost theory, the agriculture industrialization has a significant role of saving on the transaction cost; from the perspective of institutional change, the agriculture industrialization reflects a clear pursuit of profitability, spontaneity and progressiveness, and has obvious characteristics of induced institutional change in their development process,The operation mechanism of agriculture industrialization includes organizational mechanisms, the interests joint mechanism, the basic security mechanisms and operating mechanisms.At present, the organizational mechanisms of agriculture industrialization mainly have three modes of economic organization: leading enterprise-led, professional market-led and co-led. leading enterprise-led is currently the most common organizational model of agriculture industrialization in the practice, it does not only link small-scale peasants production and market demand, but also links urban and rural, modern industry and traditional agriculture, so that it makes agricultural production, processing, transportation and marketing sectors interrelated, promoted mutually and coordinated. This organizational model, with the joint between enterprises and households, reduces the specific investment costs and transaction costs of the production, improves agricultural production organization. The vulnerability of the contract is the most important factor to limit the organizational model of leading enterprises of. The market-led mode of a professional production, on one hand, associates the production base and peasants, on the other hand, associates consumption centers, bases on the professional market or wholesale trading center, by providing trading services for the sale and distribution parties to drive the regional specialization of production, to expand the production scale, to save economy transaction costs and improve economic efficiency. Higher transaction costs, lower economies of scale benefits are the main shortcomings of this model. The cooperative economic organization-led model is significantly of mass character, professional, mutually beneficial and self-help, which closely links the interests of peasants and cooperative economic organizations ,in accordance with the principles of cooperative system, to improve peasants'abilities against market risks and change the weak position of a single peasant, and increase the income of peasants effectively. At present, the limited stability of cooperative economic organizations, inadequate capital accumulation and imperfect management system mainly influence the further development.The interest association mechanism is the bridge and link of agriculture industrialization, only if there are enough common interests whose division can make both parties mutually satisfied, the joint between different subjects in the agriculture industrialization can be achieved. The interest joint mechanism is achieved through the combined effect of benefits distribution, benefit adjustment and interest bound. At present, the benefit joint mechanism between China's leading enterprises of agriculture industrialization and peasants shows diversification trend, which mainly consist of five modes: buyout-type, contract-type, collaborative-type, entrepreneurial-type and share-type interest linkage mechanism. In the above, the peasants'income, risks, integration organization stability, transaction costs, gradually enhance and improve along the contact way from the"loose"to"close". And the enterprise and share-type interest association mechanism represents the advanced stage for the development of agriculture industrialization, which is the future direction of development.Agriculture industrialization can be divided into the basic security system, technical support mechanisms, material support mechanisms, funding and management of security mechanisms, which constitute the security system for the development of agriculture industrialization, and provide the precondition for the agricultural industry to drive peasants to get rich.Integration organization must have a flexible operation mechanism as the basis of development, so that it is possible to survive in the fierce market competition. Management mechanisms mainly includes decision-making mechanism, incentive mechanism, development mechanism and restraint mechanism, which will be embodied into the following four measures in this paper, scientific decision-making, a clear strategic goal of industrialized operation and project choice; effective incentives, the establishment of reasonable interests distribution mechanism; development acceleration , utilization of various marketing instruments; binding enhancement, internal cost control.In the process of agriculture industrialization, the different subjects involved have different behavioral mechanisms, play different roles, playing different roles, realize their own interests. The motives of peasants'participation in agricultural industrialization is to save transaction cost, diversify risks, obtain economies of scale, the average profit and technical support; the leading enterprises constitute the leading force for the process of agriculture industrialization, it sometimes over-relies on the government, sometimes produces the impulse to damage the interests of peasants, but as a rational economic man, its all actions are aimed at maximizing the profits; the purpose of the government involvement is to solve the conflict between market targets and public welfare goals, increase peasants'income by leading enterprises, promote the agricultural industry management system to form economies of scale, and solve agriculture financing dilemma of industrial management systems.The games of peasants and leading enterprises are composed of non-cooperative single game, non-cooperative repeated game and cooperative game. By the equilibrium analysis, we can reach a conclusion, the close degree of contract between peasants & leading enterprises and the cooperation mode determine whether the peasant can acquire and possess the economic interest and the shared amount formed in the agricultural processing and marketing sectors, therefore, the only easy link with the agricultural production, processing, marketing and other areas to form a loose or semi-tight association can not ensure peasants to continue to raise income levels. Only by strengthening cooperative relations between peasants and the leading enterprises, changing the dependency status of rural households, transferring non-cooperative game into a cooperative game can fundamentally change the fate of peasants. In this sense, the cooperative game is the trend and superior form of agriculture industrialization development, is the most secure operation mode of agriculture industrialization for the economic benefits to peasants. The benefit losses brought from the reputation can be used as a threat to perform cooperative game and promote the bilaterally specific investment; the integrated business model adjustment characterized with the ownership transfer, such as becoming shareholders, merger, etc. makes peasants"internalized"as organic compositions or assets owners of leading enterprises, and ensure the division right of interests in the process of agriculture industrialization in the respect of system.Regarding the game between leading enterprises and the government, measures must be taken to improve the efficiency of government support policies and curb rent-seeking behavior; reduce the information asymmetry; regulate the behavior of local governments, overcome the disadvantages of government short-term targets. Consequently, they can avoid the game balance to become inefficient.Through the analysis on the operating mechanism and the behavior mechanism involved, the paper learns from domestic and foreign experience of the agriculture industrialization in the advanced countries, proposes the seven paths to promote the development of agriculture industrialization. Strengthen financial support for the agriculture industrialization; improve financing system for the agriculture industrialization, regulate project funds management for the agriculture industrialization, perfect the agricultural industry organizations and the interest joint mechanism of peasants, implement brand strategy of agriculture industrialization, promote technology innovation of leading enterprises, prevent the operating risks of agriculture industrialization.