Empirical Research On Opportunity Cost And Subsidy Policy's Impacts On Grain Acreage

Food is the paramount necessity for the residents,and food security is vital to a country.In recent years,the cost of grain has stayed at a high level along with a sharp rise in the factor price,which leads to a continuous drop of grain production's comparative benefits and squeezes the profit margins of grain.For these reasons,grain earnings have been low volatility and the interests of farmers have reduced,which make more farmers choose the economic crops or attend in grown industry.In order to ensure national grain security,grain direct subsidy policy was fully implemented throughout the country in 2004.Ten years later,grain subsidy system constantly has formed,including grain direct subsidies,agricultural comprehensive subsidies,subsidies for seed and subsidies for farm machinery.In this context,the question about the effects of opportunity cost of grain production and food subsidies on grain acreage and production has a very important significance.Jiangsu province,which is considered as a major grain-producing province in our country,is full of importance.With respect to the major grain-producing areas,the gap of regional economy in Jiangsu province becomes larger and larger,at the same time,the opportunity cost and subsidy policy of grain have obvious differences among the south,the middle and the north place of Jiangsu province,which lead the different effects on grain acreage.According to the data of household survey,based on theoretical knowledge combined opportunity cost and subsidy policy,the paper analyses the current situation of opportunity cost in grain cultivation in Jiangsu province,then the paper takes the size and effects of the subsidies into consideration,at last,the paper tests the effects of opportunity cost and subsidy policy on grain acreage by econometric model.Then the paper finds that,the effects of opportunity on grain acreage are larger in the south place than that in middle and north place in Jiangsu province,but the influence of subsidy policy is on the contrary.On this basis,the paper suggests including increasing the subsidies in the middle and north place.For the south place,the government should adjust the planting structure of grain and take advantage of regional economic advantages to improve the conditions for agricultural production,encourage the development of high-efficiency agriculture.