Study On Agricultural Risks From The Perspective Of Industrial Chain And Stakeholders’ Rationality

Agriculture is the fundamental sector of national economy, but it is also a typical high-risky and vulnerable industry. The traditional agricultural risk is mainly caused by natural harzards, such as floods, droughts, etc. As human-beings entered the industrial era, featured in rapid development of technology, innovation of production model and intensification, the characteristics and causes of agricultural risks have been significantly changed. Modern agriculture is no longer a single production department, but formed a whole industrial chain, including pre-production, in-production and post-production. With the global market development equipped with modern logistics and transportation, agricultural risks can not only affect the industrial chain within an area, but can also rapidly spread into large regional area and consequently strike the whole industry and become public crisis events. In the agro-industrial chain, there are many stakeholders with their own rationality of maximizing business profit and minimizing risks and possible economic loses. Stakeholders’profit-searching rationality, risk management strategies and game play between each other in dealing the risks are the major factors of the agricultural risks formation and spreading.Through field investigation and case studies in one county of Hunan Provincie, the author reviewed the risks of crop plantation and livestock husbandry with more systematic analysis about animal epidemic risk focusing on the potential risk points, risk delivery, risk-related stakeholders, stakeholders’interest rationality and game play with each other. The article also discussed the the recent risk management institution supply, the innovation of agricultural production organization structure and their value to agricultural risk management.Based on findings from the case studies, the author made conclusions:(1) Agricultural production is composed of natural re-production and social economic re-production, which decide the diversification and complication of the agricultural risk. On one hand, the uncertainty of the traditional natural risk is expanding, while on the other hand, agriculture was encountered with more social-economic risk factors with the development of modernity and golobalization. Social-economic risks become the main agricultural risk factor. Agricultural risk in modern society has some characterisitcs of modernity, for example,"man-made"risks become more and more. Some risks are driven by interests.(2) Industrial chian is a risk chain. Animal epidemic disease is the basic risk for animal husbandry. The potential risk points spread in pre-production, in-production and post-production. Agricultural risk is delivering through market transaction so that the risk supervision should cover the whole industrial process. Animal epidemic risk management is one of the responsibilities of the government, however, the overlapping of the government functions, the failure of their performance and corruption lead to "government failure" in risk management. (3) Risk delivery in industural chain is the result of different stakeholders’game play. This research identified the stakeholders in the initiation and delivery process of animal epidemic risk. Through case study, the article illustrated how different stakeholders, driven by interest rationality, formed a "collusion interest chain" and pushed the risk deliver from the in-production to post-production. Agricultural risk management should not only pay attention to the production and risk management behavior of different stakeholders in the industrial chain, but also should pay attention to the interest relationship and the game play process between different stakeholders. Agricultural risk management should pay attention to multi-interest coordination mechanism.(4) Government, farmers and market should be involved in agricultural risk management. Government provides a lot of institutions for agricultural risk management. When it comes to the agricultural risk management, government should choose the most suitable risk management tools and institution combination to improve the risk management efficiency. The innovation of agricultural production organization structure between different stakeholders in the industrial chian can form effectively risk sharing mechanism. The risk sharing mechanisim should be built on a reasonable interest distribution and coordination mechanism. Different stakeholders in the industrial chian should have mutral trust to avoid moral risk and adverse selection.Based on the above findings, this article proposes some recommandations in government’ role in agricultural risk management, how to improve farmers’ awareness and ability to resist risk, build the industrial chain-based quality supervision for agricultural products, improve stakeholders’ mortality and legal restraint, and how to improve the animal epidemic risk management.