Study On Long Effective Mechanism Of Farmers' Income Increasing In China

Farmers' income is a key point in the rapid development of agriculture and modernization of rural areas and even the bottleneck restricting the fast development of national economy. However, its present situation in our country is not optimistic. Annual increase of farmers' net income per capita was about 9% in the 1980s and decreased to less than 5% in the 1990s. It increased by 9% in 1996 than the previous year and 4.6% in 1997, while 4.3% and 3.8% in 1998 and 1999 respectively; and only 2.1% in 2000, which was far behind the actual increase of the disposable income of city and town residents which was 6.4%. Especially from 1998 to 2000, farmers' income from agriculture continuously reduced for three year by 28 yuan, 53 yuan and 48 yuan respectively than the previous year, which had never happened since the reform and opening-up. And from 1999 to 2000, net income per capita of specific households and part-time households continuously dropped by 13 yuan and 20 yuan than the previous year. The increasing rate of farmers' income bounded back to 4% in 2001 and farmers' income increased by 4.8% in 2002 which was still far behind that of city residents. According to information from Central Leading Group of Finance and Economics, during the period from 1997 to 2003, the highest annual increase of farmers' net income per capita was 4.8% and the lowest was 2.1%; and the average in these years was only 4% which was half of that of city residents during the same period. The stagnant increase of farmers' income brings along a series of problems to the social and economic development, which not only lets down farmers' productive enthusiasm and restricts rural social and economic development, but also plunges the whole national economy into an equilibrium on a low level. Under the circumstances, it is necessary to establish a long effective mechanism for the stable increase of farmers' income.This dissertation is based on the following hypotheses.First of all, the agricultural producing and operating mechanism is rational and the agricultural production is in a state of development; consequently farmers' income will increase absolutely. Secondly, as long as the economic and social environment for the increase of fanners' income is improved, farmers' income will definitely increase. Thirdly, with the increase of farmers' income, rural society will definitely develop. Adopting the systematic analytical approach, model analytical approach, comparative analytical approach, combined approach of positive and normative analysis and deductive andinferential analytical approaches, this dissertation carries out a detailed research on the structure of Chinese farmers' income and its developing history to find the reasons restricting the constant and stable increase of farmers' income. On the basis of the comparison of the experience of farmers' income increase between foreign countries and some domestic developed provinces, a long effective mechanism for the constant and stable increase of farmers' income is established.The dissertation is divided into seven chapters. First is the introduction part, in which the background, purpose and significance of the research, as well as the researching literature, approaches and innovative points are introduced. The first chapter is the theoretical basis of fanners' income increase. After clarification of relative concepts, the dissertation introduces present relevant theories of farmers' income increase. The second chapter is the analysis of the structure and developing history of farmers' income, including two parts. One is the detailed analysis of the characteristics of the structural change of the sources of farmers' income (including two categories: one is the income from household management of production, labour remuneration and property transfer, the other is income from agriculture, non-agricultural sectors and property transfer) and the forecast of its changing tendency. The other is the analysis of modes of farmers' income increase during different periods of time and in different regions since the reform and opening-up. The third chapter is the qualitative analysis of factors which influence the increase of farmers' income, including factors within agriculture and agricultural external environment in favor of the increase of farmer's income. The fourth chapter is the positive analysis of factors influencing the increase of farmers' income. The author firstly divides farmers' income into non-agricultural and agricultural income, then calculates the primary and subordinate influencing factors by the path analytical approach and the production function approach, and arranges these factors according to their influencing power. The fifth chapter is the comparison of farmers' income increase among developed provinces. The author chooses Zhe jiang Province, whose farmers' income increase has ranked the first place for nineteen years, and Jiang su, Guang dong and Shan dong Provinces as representatives to analyze the structure of farmers' income and the increasing modes and draw experience for popularization and demonstration. The sixth chapter is devoted to the establishment of the long effective mechanism of farmers' income increase and the reference to foreign experience. With understanding of the concepts of mechanism and long effective mechanism of farmers' income increase, this chapter introduces its structure,characteristics and the principles for its establishment. It also provides reference to foreign experience. The seventh chapter is the establishment of the long effective mechanism of Chinese farmers' income increase, including the flexible environment and hard environment construction for farmers' income increase. And the author provides corresponding long effective mechanisms for the constant and stable increase of farmers' income in different regions.The fresh points of this dissertation are as follows:The first innovative point is to analyze the structural change of the multi-sources of farmers' income and predict their trend in increasing farmers' income in the future, whose conclusion is that the potential of increasing farmers' income from household management of production is little, especially the agricultural income, and that that from the labour remuneration and non-agricultural sectors is great, especially the income from non-agricultural sectors will surpass that from agriculture and play a decisive role in the increase of fanner's income.The second one is to calculate ? the primary and subordinate factors influencing farmers' income from agriculture and non-agricultural sectors by the path analytical approach and the production function approach on the basis of qualitative analysis and categorization of such factors. The conclusions from both approaches are the same, illustrating the correctness of these approaches and the rationality of the results, which are that the main factors promoting the increase of farmer's agriculture income are the expenditure of the household management of production, the amount of fertilizer used, the purchasing price index of agricultural products and the acreage under cultivation at the end of the year with no obvious effect, that the main factor restricting farmers' income increase is the price index of agricultural productive material and the subordinate one is the disaster-caused percentage. Those promoting the increase of non-agricultural income are the total amount of fixed assets investment of the whole society and the urbanization rate and the main factor restricting the increase is the ratio of the income between urban and rural residents and the subordinate one is unemployment rate in cities and towns.The third point is to sum up the modes of farmers' income increase during different periods of time and in different regions since the reform and opening-up. The modes during different periods of time are as follows: the first one is from 1978 to 1984 when the increase of farmers' income is dominated by the agricultural development, the second is from 1984 to 1988 dominated by the deterioration of the exchanging condition ofagricultural and industrial products and the holdback of agricultural development, the third is from 1988 to 1992 dominated by the governmental intervention, the fourth is from 1992 to 1996 promoted by the rural industrialization during the establishment of market economic system and the fifth is from 1997 up to now dominated by the development of non-agricultural sectors. The regional modes are the urban-promoting mode, the non-agricultural industries dominated mode, the agriculture-dominated mode and the agriculture-promoting mode.The fourth and last innovative point is to establish the long effective mechanism for the increase of farmers' income by theoretical and positive analysis. The main body of the mechanism is the internal dynamic mechanism and its carrier is the cooperative organizations and industrialized operating organizations, with the government macro regulative mechanism as its direction. The dissertation puts forward systematic and practical countermeasures for the establishment of the long effective mechanism for farmer's income increase, including that the government should establish a good and flexible environment for farmers, provide institutional support and improve the market environment and regulate its behavior, and that farmers should make use of government's proper macro-regulation and advanced intermediate market organizations to develop agricultural production, improve productive efficiency and increase income through rural industrialization and urbanization, the adjustment of industrial structure and agricultural industrialization, as well as science and technology.