Rice Production Behavior Adjustment And Production Efficiency Under Rapid Transformation:

With large number of rural labor continuing to transfer to non-farm areas, it not only results in the rising number of migrant workers, a decline in the quantity and quality of rural agricultural labor, as well as rising real rural agricultural labor daily wage. At the same time, the central government has been encouraging farmers to purchase and (or) use agricultural machinery. Under the support of national policy and also as an inevitable reaction to rural agricultural labor decreases, great strides have been achieved in mechanizing food crop cultivation. In addition, along with the development of rural economies, land transfer has been accelerated in recent years under the favorable policy environment, resulting in the gradual emergence of the coexistence of a moderate scale and small-scale farming. Under the constantly changing environment of China’s agricultural production, China’s total grain output has increased in eleven years in a row. However, judging from the point of structural adjustment of grain, the proportion of rice output over total grain output is declining.Rice is of great importance when it comes to food security in China. This thesis aims to investigate both theoretically and empirically the rice production behavior adjustment and productivity of rice farmers under rapid transformation by using micro survey data from Jiangxi Province; the main indica producing area in South China. This thesis interprets the rice production behavior adjustment by selecting three phenomena as the cutting points to reflect the background of economic and institutional transformations. The main contents of the thesis and related conclusions can be divided into the following four parts:The first part investigates farm size-productivity (both land productivity and profit) relationship under rapid transformation. The objective of this part is to examine whether there is a "small is beautiful" phenomenon under China’s current agricultural production environment. This is to provide evidences on how the government should choose proper policies regarding agricultural production. Few studies have addressed the farm size-productivity relationship for China and those that do only do with outdated data sets after a decade of rapid changes. These changes include the development of land rental markets, village labor out-migration, and use of farm machines. Using yield and profit as the proxy variables of land productivity, we find that these changes all affect the farm size-productivity relationship. While controlling for farmland quality, imperfect factor market, and farm size measurement error, the regressions show that land yields increase with plot size both by season and over the year. In addition, paddy farmers are achieving sufficiently higher profits to compensate landowners to allow for consolidation and still have incentives for private investment to boost production. This may be one of the reasons that farm sizes are growing in some areas. Moreover, from the production function method, we find land yields increase with farm machine use. This result offers another facet in the debate over whether mechanization improves yields or just expands the land frontier in China.The second part selects the perspective of technical efficiency and examines the impacts of off-farm employment, land transfer and farmland fragmentation on the technical efficiency of rice farmers in a unified framework, by using the one-step stochastic frontier analysis method, in order to evaluate related policies. The study finds that the technical efficiency of the surveyed indica producing rice farmers ranges from 0.613 to 0.997, with mean technical efficiency being 0.973. Besides, complying with Food and Agriculture Organization (FAO) criteria for the classification of households’ actual cultivated area, rice farmers whose actual acreage is more than 2 hectares achieve significantly higher average technical efficiency. Thirdly, rice farmers who occurred land transfer reach significantly higher average technical efficiency than those who did not occur land transfer. However, for rice farmers who occurred land transfer, the technical efficiency of the rented-in plot is not significantly different form the plots allocated by the village. Fourth, non-farm employment has a significant positive impact on rice farmers’ technical efficiency, while the higher the degree of fragmentation of farmland, the lower its technical efficiency.Stage outsourcing behavior of rice farmers has become increasingly important because of the rapid transformation of China’s countryside. However, few studies have addressed this issue using a theoretical framework. The third part sets out to fill this gap in the literature by developing a theoretical model that integrates determinants of rice farmers’outsourcing behavior and number of rice growing stages outsourced, and use a Probit model and a Poisson model to estimate at both the growing season-level and the household-level, respectively. Moreover, a multivariate probit (Mvprobit) model is used to determine whether outsourcing decisions are made at different stages in isolation or are related. Descriptive and regression results show that stage outsourcing in rice production is a common phenomenon, especially for labor-intensive stages, with technology-intensive stages still generally finished by family labor. Secondly, rice farmers with different production scales utilize different outsourcing modes with small-scale rice farmers typically outsourcing labor-intensive stages, while large-scale rice farmers exhibit a higher proportion of technology-intensive stage outsourcing. Thirdly, Mvprobit model regression results show that outsourcing decisions made at different rice production stages are related, and are not made in isolation. Fourth, different factors affect outsourcing decisions at different kind of rice production stages. In general, not only are growing non-farm employment opportunities and rising non-farm incomes facilitating rice farmer stage outsourcing, but also reducing outsourcing prices will increase the proportion of outsourcing taking place at each rice production stage.Following the third part, the fourth part aims to assess whether stage outsourcing will affect the output level of rice farmers by applying both individual and time two-factor fixed effects model with C-D production function. The study reveals that whether a significant positive impact of stage outsourcing in rice production exists depends on how to deal with the opportunity cost of family production inputs, such as family labor or/and family machine. Assuming the opportunity cost of family production inputs being zero, stage outsourcing in rice production does not significantly affect rice output level. However, when using stage-specific individual shadow value for family production inputs, the degree of stage outsourcing will significantly promote rice output level in general. In terms of specific rice production stages, for both land preparation and transplanting, the higher the proportion of outsourcing inputs in each stage, the higher the ultimate rice output level will be.The innovation of this thesis lies in that it interprets a multi-perspective picture of rice production behavior adjustment and productivity of rice farmers under rapid transformation by especially paying attention to the great changes taking place in China’s production environment, which includes the development of land rental markets, village labor out-migration, and use of farm machines. More specifically, the thesis fills the gap in farm size-productivity relationship of China after 2003. Since this is when China’s agricultural production environment experienced dramatic changes, and land policy became one of the hot issues important to both researchers and policy makers. Secondly, village labor out-migration, land transfer and farmland fragmentation coexist in China’s agricultural environment. However, previous studies on farmers’ technical efficiency of agricultural production focus on only one or two factors among the aforementioned three factors. Different from the previous studies, this thesis was conducted in a unified framework to scientifically examine the impacts of off-farm employment, land transfer and farmland fragmentation on technical efficiency of rice farmers. Last but not least, instead of analyzing each stage outsourcing decision as an independent event, the thesis takes into consideration of correlation in stage outsourcing decisions and adopts a multivariate probit (Mvprobit) model to determine whether outsourcing decisions are made at different stages in isolation or are related.