The Interactive Growth Mechanism And Policy Research On Production, Consumption,and Non-labor In Agricultural Household

Agricultural household (peasant family) is the basic unit of agricultural economic activities in our country. Its general characteristics, such as low commodity rate of agricultural products, high degree of concurrent occupation, a large proportion of non-farm income, etc., make Chinese agricultural household a complex economic subject which is a typical set of agricultural producer, non-farm labor (supplier) and consumer. The environment change of national macro economy and policy, especially the market change of agricultural products and labors will affect the agricultural production, non-farm labor supply, income and consumer demand of the agricultural household. Meanwhile, the agricultural household’s decision on production, non-farm labor and consumption will also have a huge impact on macro economic development and even the implementation effect of government policies. Therefore, research on the reciprocal relationship among production, consumption and non-farm labor of agricultural households from micro perspective has a very important practical significance to judge the trend of agricultural production, rural consumption as well as labor transfer.Starting from agricultural household, based on new family economics, this study integrates production, consumption and non-farm labor issues of the agricultural household into an overall analytical framework, and constructs a Chinese agricultural household model (’CAHM’model) reflecting the basic economic characteristics of the Chinese agricultural household. On this basis, through the data of the field survey on482agricultural households from ten villages of nine cities in six provinces of Shanxi, Henan, Anhui, Shaanxi, Shandong, Zhejiang, representative agricultural households from different regions are used to build CAHM models respectively. Models are exploited to stimulate and analyze the effects of food subsidies, the prices of agricultural production means, the price of agricultural products, the price of labor on production, consumption and non-farm labor, as well as the interaction among the three above in the agricultural households, to reveal the coordinated growth mechanism of production, consumption and non-farm labor of the agricultural households. Accordingly, policy implications are proposed aiming at raising the income of the agricultural households to promote the agricultural production, increasing the chance of non-farm employment and improving the consumption level of the peasants. The main contents and conclusions contain the following five parts: First, theoretical analysis framework is built for the research on production, consumption and non-labor of Chinese agricultural household. Based on the analysis of basic economic characteristic of Chinese agricultural household, Chinese agricultural household model is constructed which combines producers, consumers and workers together, according to the theory of agricultural household. And also the model structure, mathematical expression and solving method are analyzed in detail. All these provide the general idea for the following research.Second, the economic status of sample households is analyzed comparatively and the genesis of their differences is studied empirically. Based on the descriptive statistical analysis of the sample households by the field research data, the econometric models are used to research the main factors that make the regional difference of production, consumption and non-farm labor in various agricultural households. These also provide the necessary parameters for empirically establishing the CAHM model for representative agricultural households from different regions. The results show that:(1) agricultural policy, regional economy, public services, infrastructure, resources and environment constitute the important external factors which influence the economic decisions of the agricultural households.(2) As to the sample households of the eastern China, agricultural production resource is limited and comparative advantage of grain is low; As to the sample households of the midwest, the feature of concurrent occupation which is "farming in the busy agricultural season and non-farm employment in the slack agricultural season" is prominent; There is in general a high proportion of food consumption and a lack of production expenditures in agricultural households from different regions and types.(3) The utility of agricultural household depends on income and leisure, and the leisure elasticity is greater than the income elasticity.(4) Agricultural households dominated by the non-farm income tend to transfer out of their farmland.(5) For the agricultural households, the prices of agricultural production means and agricultural products have the significant effects on the agricultural investment, while household income and consumer price have the significant effects on the structure and quantity of living consumption.Third, the CAHM models of the representative agricultural household from different regions are constructed and studied empirically. Based on the general structure of CAHM model, six representative agricultural household are constructed empirical model respectively. The optimization results of the models show that:(1) The production, consumption and non-farm labor of agricultural households exists the obvious coordinated growth relationships.(2) There is a lager adjusting space for production, consumption and non-farm labor of agricultural households in the current policy environment.(3) The agricultural households endowed with small scale and single farming are increasingly turning their operation modes to concurrent occupation and diversification, in order to improve household income. And the growth rate of non-food consumption is significantly higher than that of food consumption in the agricultural households.Fourth, the production, consumption and non-farm labor are studied by simulation, optimization under different scenarios. This dissertation takes food subsidies, the prices of agricultural production means, the price of agricultural products and the price of labor as four different scenarios, uses the CAHM model of each representative agricultural household for simulation and optimization analysis. It is reflected that:(1) There are little effects of15%-25%raises of the food subsidies on production and income increase of small agricultural households, due to that the opportunity cost of farm labor is higher than the food production income.(2) If the prices of major agricultural production mean increases10%or20%, the food production of the agricultural household will decline over10%, while some breeds of livestock are supplied abnormally. The non-farm labor will increase by at least20%, which leads to the source structure change of food demand in agricultural households.(3) When the price of major grain and livestock products increase10%and30%respectively, the grain production structure is essentially the same and the total grain production increases8%, while livestock production structure changes considerably, part of the livestock breeding scale even double the size. In addition to increasing the self-sufficient consumption of subsistence to save expenses, the average labor supply of the agricultural households increases more than2%, which increases over10%of the family income to ease the incremental pressure.(4) The15%-20%growths of labor wages leads to12%reduction of farm labor and22%increase of non-farm labor in the agricultural household. The improvement of income makes the living consumption expenditure increase by4%, but does not indicate positive effects on agricultural inputs.(5) There are different influences of food subsidies, the prices of agricultural production means, the price of agricultural products and the price of labor on production, consumption and non-farm labor of various agricultural households. The change of these policy and market environment has greatly affects the midwest agricultural households with income mainly from agriculture and with less non-farm opportunities.Fifth, it is the main conclusions and policy implications. Based on summarizing the main conclusions of this study, policy implications are proposed from the aspects that enhance the ability of small agricultural household to adapt to the policy-market environment, increase food subsidies and expand subsidies range, stable the price of agricultural means and products, and improve the system of labor market, etc, in order to raise the income of agricultural production, improve the consumption level of the agricultural households, and increase the non-farm employment chance of peasants.The innovation of this dissertation lies in that: From a theoretical perspective, it breaks through the limitations of previous study on the agricultural household issue of production, consumption or employment separately, and takes these three as a whole to explore the interaction among production, consumption, and non-farm labor of the agricultural household. In the aspect of research method, the non-separate model CAHM is built, considering the basic economic characteristics of Chinese agricultural households. Updated by the data and parameters, CAHM will become a microscopic analysis tool for agricultural policy. As to the research results, a large number of micro-quantitative information about production, consumption and employment of the agricultural households concluded from CAHM model studies with high scientific and practical value, will provide forward-looking decision basis for making agricultural policy of the government.