The Effect Of Agricultural Insurance Subsidies On Rural Residents’ Income

Developing agriculture is the foundation of developing China into a modern socialist country.Meeting the people’s needs for a better life,achieving high-quality development,and consolidating the foundation of national security are all inseparable from agricultural development.However,due to the long cycle of agricultural production,easy to be affected by natural disasters,coupled with the price fluctuation of agricultural products,related risks seriously affect the stability of agricultural production.At the same time,rural residents’ income is uncertain due to agricultural risks,which in turn will lead to the decline of rural residents’ enthusiasm for agricultural production.In order to stabilize agricultural production and realize agricultural modernization,it is necessary to strengthen the level of agricultural risk management and improve the anti-risk ability of agricultural production.Agricultural insurance is the stabilizer,booster and risk controller of agricultural production.Agricultural insurance provides compensation for agricultural producers who suffer from agricultural disasters and promotes the recovery of agricultural production at the same time as increasing the income of farmers.Therefore,agricultural insurance is an effective tool to disperse agricultural risks,stabilize agricultural production and increase the income of rural residents.Agricultural insurance products have been around for a long time,but it has been booming since 2007,when the Ministry of Finance issued the "Management Measures for the Pilot Agricultural Insurance Premium Subsidies of the Central Finance",which brings us an intuitive judgment that the financial subsidies of agricultural insurance are an important prerequisite for agricultural insurance to play a role.Since agricultural insurance financial subsidies do not directly increase the income of rural residents but play a role through agricultural insurance,and there may be a phenomenon of welfare dissipation in the process of playing a role,so whether agricultural insurance financial subsidies can increase the income of rural residents is an important standard to test the effectiveness of agricultural insurance financial subsidies policy.In the theoretical analysis part,this paper analyzes the reasons why agricultural insurance financial subsidies can affect rural residents’ income through agricultural insurance,and concludes that agricultural insurance financial subsidies have an impact on rural bureau and residents’ income through affecting agricultural production scale and agricultural insurance compensation.In the empirical analysis part,this paper uses provincial panel data from 2008 to 2019 and uses the fixed effect model to test the effect of agricultural insurance financial subsidies on improving rural residents’ income,and draws the following conclusions:(1)Agricultural insurance subsidies significantly increased rural residents’ income at the level of 1%,and the regression coefficient was 0.263.(2)The heterogeneity analysis of the effect of agricultural insurance subsidies on rural residents’ income found that agricultural insurance subsidies significantly increased the income of rural residents in eastern and western China,but had an inhibitory effect on the income of rural residents in central China.The effect of agricultural insurance subsidies in different regions may aggravate the pattern of income gap between regions.Moreover,agricultural insurance subsidies significantly increase the income of rural residents in non-agricultural provinces,which is conducive to improving the overall economic strength of the country(3)Agricultural insurance subsidies can increase the income of rural residents by increasing the scale of agricultural production.The coefficient of return of financial subsidies for agricultural insurance on the scale of agricultural production is 0.357,and financial subsidies for agricultural insurance can significantly improve the production enthusiasm of rural residents.(4)Agricultural insurance subsidies can improve rural residents’ income by increasing agricultural insurance payments,and the regression coefficient of agricultural insurance payments to agricultural insurance financial subsidies is 0.927.To sum up,Agricultural insurance subsidies can improve the income of rural residents,stimulate their enthusiasm for production,stabilize agricultural production and promote agricultural development through agricultural insurance.Finally,based on the problems in the process of affecting the income of rural residents and the horizontal comparison between the OECD countries and the policy-based agricultural insurance,this paper proposes suggestions for improving the policy-based agricultural insurance business and constructing high-quality agricultural insurance.