Research On The Default Game Considering Farmers’ Risk Preference In Ordered Pig Breeding Mode

China is the country with the largest pig production in the world,the stability of pig supply is closely related to the living supply of urban and rural residents as well as the "vegetable basket project” of urban residents.As the pig breeding mode shifts from traditional free-range to large-scale breeding,more and more farmers have adopted the ordered mode for live pig production and connected with the market indirectly,which solves the difficulties of "small farmers" go into the "big market",the company also stabilizes the supply source,and the two sides achieve mutual benefit and shared profit.However,in practice,due to the obvious price fluctuation in the market of live pigs,and the relationship between the company and farmers in ordered pig breeding mode is very unstable,with frequent contract-breaking phenomenon.This study comprehensively used behavioral economics,evolutionary game theory and other theories to study the default problems in ordered pig breeding mode.in order to provide a certain decision-making reference for improving the status of default in the mode.The main research contents of this paper include:Firstly,this paper constructed the default game model with or without government intervention by adding the risk preference theory.On this basis,the influence of different parameters on the evolutionary stable solution and results is analyzed.The results show that: in ordered pig breeding mode,the contractual relationship between the company and the farmer is very loose.Changes in market quotations are the reasons that affect the default of both parties.In addition,it includes contract price,transaction costs,liquidated damages,and the risk preference of farmers.The government can effectively avoid the default risk of farmers and companies by establishing credit system and punishment mechanism.Secondly,in view of the problems exposed in the above game analysis,starting from the contract,the price risk sharing mechanism and the agency mechanism of intermediary organizations were introduced to explore a more reasonable cooperation mode to solve the default problem in the mode.It shows that the introduction of price risk sharing mechanism can formulate a more flexible contract price,thereby reducing the risk of default by market price fluctuations;signing a tripartite contract between a farmer and a company and an intermediary organization can increase the binding force of the contract and reduce the default risk of the contract.Thirdly,in order to transfer the risk of default from the inside of the participation subject to the outside,the pig futures and option theory were introduced,and a game model considering risk farmers’ preferences in the "company + farmer + futures +options" model is constructed.On this basis,the influence of different parameters on the evolutionary game path and results is analyzed by numerical simulation.The results show that companies can use the price discovery function of the live pig futures market to formulate higher contract price,then the company signed a contract with farmers in the nature of options and obtained the right to purchase live pigs.Finally,the company carried out hedging in the live futures market,which could effectively avoid the default risk of both parties.Finally,we summarized this paper and made some other recommendations to avoid the default risk in ordered pig breeding mode.