The Impact Of Externalities On Farmers' Planting Decisions

The implementation of household contract responsibility system not only gives peasants more autonomy and independent decision in production, but also makes the lands smaller, and forms special characteristics of mixing plants. Along with the government's intervening in agricultural product and circulation reduced, the position of peasants' independent decision-making has come true, and the economic model based on independent decision-making seems to be universally applicable. Therefore, the farmer's production and human resource heterogeneity and the existing research about plant diversity shows that farmers can take full advantage of relative surplus labor force to increase the net income of families, which should infer the plant diversity in the general cultivation in real life, the lands used for mixing plant should also be regularly growing different crops. However, in a certain geographical area, the small-scale farmers contiguous planting the same crop, using the same kind of technical measures is an ongoing phenomenon, that is, farmers will arrange different plants in one land, but the adjacent terraces for growing crops are not arranged different plants.Many scholars think that the traditional practice of farmers or conformity among farmers has impact on peasants' decision-making, but this study suggests that one possible explanation of so-called "conformity decision-making" is that the technical externality constraints farmers'independent decision-making, which force them using the same kind of technology to plant the same crop in a separate small piece of farmland. The technology of certain crops, such as irrigation, fertilization, and spraying pesticides on crops within a certain range has strong external influences, and therefore requires a certain minimum scale of production; if the farmland area of individual peasant couldn't reach the minimum scale requirements, it must team other farmers, who has the adjacent land, to making a unified decision-making in some way. So, comparing market transactions, some informal the same decision-making are also possible options for farmers. Clearly, both the constraints strength of externalities of the production decision-making and the transaction costs of unified decision-making are determined by the size of household plots and the smallest proportion of economies of scale. There is no doubt that large farmers with thousands hectares lands is truly independent decision-makers and they would not be impacted by the externality of decision-making; a small number of large producers will be easier to reach agreement through commercial negotiation. However, for many small farmers forming a geographical community, the non-market-oriented the same decision-making may be the choice of lower transaction costs.The paper concerned is that the decision-making in cultivation is similar among farmers. Why the famers grow the same crop in the adjacent plots of land? Is the similarity the convergence of independent farmers or the action forced? What factors impact the similar decision-making in cultivation among farmers? This is the basic problem what this paper studied.To test these hypotheses, we must find a suitable object for studying. The external nature of the decision-making has little effect on the decentralized agricultural land divided by Hilly terrain. Compared to harvest crops, the time consistency requirement is relatively low by production technology measures on summer crops such as irrigation, fertilization and pesticide spraying etc. In contrast, farmers may be make their own decisions dependently ,who is in the harvest field crops planted area with many farmers having a small, land-linked, non-topographic conditions separated land. Therefore, the objective is to verify whether the farmers'production is limited by the external nature and show a certain degree of the same decision-making behavior or not. The basic logic is that if there is relatively strong crop production externality, the probability of farmers choosing a same decision-making and contiguous cultivation is relatively large.If the results of the empirical study support the judgment, the analysis result may have a bias in the household behavior in independent decision-making. Therefore in the future the household behavior study need to distinguish the household decision-making is collective or independent. This study conclusion also provides the theoretical basis in the practice on how to choose the form of the same decision-making and improve the efficiency of the same decision-making.This research will build up a framework according to both agriculture knowledge and economy methodology, detailing the main sources that affect planting decision of farm household. Basing on field research and personal interview, this paper has referred to related professional books, and agri-experts, to get acknowledge about plant categories in sample district, rank the plant categories in impressionable order, and find out the main sources that affect common decisions. This research will measure the level of common decisions according to ratio of fields that share the same plant to all the neighboring fields.This research has defined eternality of plant production, field area, features of households and planting area ratio, as the sources that may affect common decision, out of which the former two are considered to be the main factors. Restriction of eternal factors forced households to share their common decisions. The research has proved that more eternality the plant production involved and less planting area would lead to a more chances that farmers share the same plants.Comparing solution to correct eternality, this research proved that market or legislation power could not work. Common decision forms have been discussed basing on former researches and practical cases. Similarity of farm households depend itself on production restriction and market restriction. Forming a consistent or similar decision may need market negotiation among independent decision makers, or some authoritative way, or informal negotiation, or a traditional way; and all of the solution aside of negotiation on market, could be considered as market decision. The research concluded existing informal common decision forms as below:(1) Some kind of traditional behavior or thinking pattern that people followed;(2) A closet and stable clan that is hierarchical, self-supplied, majoring in agriculture, following a certain custom, living in a compact community;(3) Rational administration intervention on behalf of most people's interests;(4) Administration council selected from the base, on behalf of the farmers, serving as proxy of national power.(5) Capable man who has strong power over the whole countryside, mostly are rich in land and money, and more educated.Common decision is a certain phenomenon under eternal restriction. As long as the restriction exists, common decision will exist as a substitute of market dealing. The form of common decision varies in different areas, but the essence doesn't change; whatever the form, common decision is always a mirror of people's willing.This research demonstrated that empirical result would be deviated as a result of farmer's independent decision, which is opposite of assumption in most of existing research. It also found that would farmers be dependent deciders, farmers should decrease and migrate to urban, so that land would be concentrated into fewer people who could manage the land in a large scale.This research also proposed a further question:As to decisions with strong eternality, whether they are necessary that a clear property and a regular market negotiation and legislation procedure? Whether they would decrease social aggregate welfare? On the contrary, whether some social capital could work it out in more efficient way without losing welfare? Transaction cost would give a clue:the smaller scale of famers'management, the higher it would cost them to resort to a regular negotiation and legislation.A further research on above questions will help policy makers to avoid over-underlined independent decision related with private property, and make a full use of social capital, in order to prove economic efficiency and decrease economic cost, in the process of property regulation reform, at least before farmers'management has been scaled up, and eternality internalized basically.