Farmers' Personal Relationship Network Structure, Channel Behavior, And Relationship Stability In Contractual Channel Of Agricultural Products

Since the development strategy of agricultural industrialization was put forward by Weifang City, Shandong Province, agricultural industrialization has been widely considered to be an effective way to help farmers enter the market and received high attention of the government, agriculture-related businesses, farmers and academic circles. In recent years, agricultural industrialization has obtained the rapid development under the impetus of its internal incentives and the the government's support policies, but also has met a series of problems, such as the repeatedly violation of the interests of farms, high level of the default reates, slow increase of the farmers'income, and so on. In all of these problems, the default issue in the contractual channel of agricultural products is the most serious problem. In agricultural industrialization practice, the case which the company or farm break a contract exists massively.The default issue in agricultural industrialization practice has caused widespread concern of scholars. The domestic scholars have conducted in-depth research, and obtained rich research results, especially the application of new institutional economics in this field. However, a significant lack of existing research is that scholars are mostly concerned only with the influence of the design of the contract terms, the organizational patterns of agricultural industrialization, the governance mechanisms and other economic factors on the stability of the contractual trading relationship, while the behavior and social cultural issues have not received sufficient attention. In fact, the contractual agricultural products trading relationship is also influenced by the channel behaviors, personal relationship network and other social factors. Some studies have shown that the channel behaviors have significant impact on the efficiency of the agricultural products channel, and one of the foundations of such effects is the excessive imbalance of the power structure in the agricultural products channel relationships. In addition, economic sociology pointed out that any economic activity is embedded in social relations. Social factors of the contractual agricultural products trading relationship have significant influences on the trading process, transaction mode and the performance of the entire channel. Especially in our rural society, farmers in the disadvantaged position need to seek approaches to improve the status of their transactions, while the "acquaintance society" nature of the relatively closed rural society makes the personal relationship network naturally to become an important tool for farmers to deal with transactions relationship with company. Therefore, in order to provide a wide range of research perspectives and a more extensive theoretical basis, it is necessary to introduce the channel behavior theory and social network theory to the research of the stability of the contractual agricultural products trading relationship.This paper researched the relationships among the farmers'personal relationship network structure (network density and network centrality), the channel behavior dimension (farmer's power, company's use of power, channel conflict, farmer's satisfaction), and the channel relationship stability (farmer's default tendency and renewal will) using social network theory and channel behavior theory. The major efforts of this study are as follows:First, through the review of social network theory, channel behavior theory and the research of the stability of the contractual agricultural products trading relationship, gaps in the theory of the existing researches were found, the research model and assumptions were raised.Second, this study will follow the standard scale development process to develop questionnaire. To measure the various constructs, validated items used by other researchers were adapted. The initial changes to the questionnaire were conducted based on the information from the farmers'interview and the suggestions of the experts. Then, the questionnaire was pilot-tested by convenient sampling, and the measurement was then refined. At last, large-scale survey was conducted, and confirmatory factor analysis was used to test the convergent validity, discriminant validity and reliability of the study constructs.Third, this study conducted a survey on the farmers who have contractual agricultural products trading relationship with company. The survey data were collected and analyzed. The hypotheses were tested by structural equation model.Fourth, the research results were discussed, and the research conclusion were summarized. Finally, the theory and practice contribution, limitations and future research directions of this study were pointed out.The major conclusions of this study are as follows:First, the analytical results of this study support the view that the farmers' personal relationship network structure is an important antecedent of the behavior of farmers and company. The network density of the farmers'personal relationship network negatively influences the company's use of coercive power and positively influences the company's use of noncoercive power and farmer's satisfaction. The network centrality of the farmers'personal relationship network positively influences the farmer's power and the channel conflict, but it negatively influences the farmer's satisfaction.Second, the farmers'personal relationship network structure indirectly influence the farmer's default tendency and renewal will through channel behaviors. The analytical results confirm that higher the farmer's network density increases the farmer's renewal will, and decreases the farmer's default tendency. The farmer's network centrality has great indirect effect on the farmer's default tendency, but slight effect on the farmer's renewal will.Third, the influence relationships among the channel behaviors in the agricultural product channel are not the same as that in industrial product channel. The farmer's power negatively influences the company's use of coercive power, and positively influences the company's use of noncoercive power. Although the farmer's power does not have a direct effect on the channel conflict and farmer's satisfaction, it indirectly affects the channel conflict and farmer's satisfaction. The company's use of coercive power has a positive effect on the channel conflict and a negative effect on the farmer's satisfaction. The company's use of noncoercive power increases the farmer's satisfaction, but it does not has significant effect on the channel conflict. The Channel conflict also has no significant influence on the farmer's satisfaction.Fourth, the analytical results confirm that the channel behaviors have significant influences on the farmer's default tendency and renewal will. Farmer's power positively affects the farmer's default tendency and renewal will. The company's use of coercive power enhances the farmer's default tendency, but it dose not significant affect the farmer's renewal will. The company's use of noncoercive power reduces the farmer's default tendency and enhances the renewal will. The channel conflict has a positive impact on the farmer's default tendency and a negative impact on the farmer's renewal will. The farmer's satisfaction positively influences the farmer's default tendency.The innovation of this research lies in three aspects:First, this study confirms that the channel behaviors do have significant influences on the channel relationship stability in Chinese contractual channel of agricultural products. Although some schlors have suggested the importance of the channel behaviors in the research of channel relationship stability, but the suggestions have not attracted sufficient attention. This study provides the empirical evidence for the importance of the channel behaviors. It not only enriches the stability research of the contractual agricultural products trading relationship, but also promotes the channel behavior research of the agricultural products channel.Second, this research tested the relationships between the channel behavior contructs in Chinese agricultural products channel, which expands the application scope of the channel behavior theory. The study found that the traditional channel behavior theory needs to be re-tested in Chinese agricultural products channel.Third, this research introduces the network density and network centrality into the channel behavior research, and tested the influences of the network structure on the channel behaviors. Although network density and network centrality have been introduced into the channel research, but there does not exist literature that tested the influences of the network density and network centrality on the channel power, use of power, channel conflict, and satisfaction. Therefor, this study further enriches the literature of the channel behavior theory.