The Economic Effects On Agricultural Standardization: Shaanxi As An Example

Standardization begins with the late industrial revolution and applies first in the filed ofindustry. From the enterprise perspective, standardized production declines operationmonitoring costs, improves market information symmetry, and reduces transaction costs.Agricultural standardization applies the principle of industry standardization and realizeseconomies of scale and transaction cost reduction in agriculture.In developed countries,agricultural standardization implemented well for their high efficient agricultural operationalsystems. In recent years, Chinese government at all level continues to increase agriculturalstandards stocks and explore the effective implementation of agricultural standardization,Standardization, to some extent, promotes the development of agricultural economy.Inpractice,Chinese government is keen to carry forward agricultural standardization while thefarmers and agricultural enterprises show inactive attitudes on the adoption of agriculturalstandards.Under the Household Contracted Managerial Responsibility System,whetheragricultural standardization implements well and how to evaluate its implementationeffects.Many scholars have discussed the necessity and the importance of agriculturalstandardization production, but the research on how agricultural standardization affectsagricultural economy development, affects agricultural foreign trade, even if affects nationaleconomy, is rare. Therefore, it is inevitable and urgent to discuss the economic effects ofagricultural standardization.Based on the abundant research results of economics of standards, the paper describesthe local agricultural standardization status, problems and its restraining forces. Finally, fromthe micro household and regional level, the paper takes quantitative research on thecontribution of standardization influcencing economy development. The major results of thispaper are as follows:1. This paper defines the research scope of agricultural standardization.From economicsperspective; it analyzes the inherent mechanism for standardization promoting agriculturaleconomy development. To a great degree, technical standards show technology progress,agricultural standards implementation facilitates technology transformation and improvesagricultural production efficiency. As the link farmers with agricultural leading enterprises, consumers, agricultural technical standards transfer the market signal and reduce the markettranction cost. Standardization has a dual role on the agricultural international trade. The newstringent technical standards set by developed countries could in fact inhibit export ofagricultural product from developing countries in the short term, but in the long run, the tradeeffects are uncertainty.2. This paper describes the status and problem of local agricultural standardizationimplementation, which shows the local standardization policy direction.Agriculturalstandardization system in Shaanxi, has been formed, and local agricultural standards risesteadily. Compared with other provinces, agricultural standardization in Shaanxi lags behind,especially in lack of standards before and after agructural production satge, farmers’sstandardization awareness; etc.These restraing forces explain the reason why localstandardization develops slowly, which include motivation lacks of farmers and enterprises,limitations of traditional farming culture, techonology lags behind and imperfect system ofsupervision for local government.3. Farmers’ behavior of participating in standardization production is affected bypersonal characheters, standardization cognitive level, the surrounding standardizationorganization demonstration, production decision and market demand.Under the threehypotheses, Logit model is employed in analyzing the factors, of affecting farmersstandardization production participation. The results show that government policy guide,surrounding standardization organization demonstrate effects, and market strong quality needsand high standardization cognitive level have actively influenced their behavior ofstandardization participation. While farmers’ personal characters such as age, educationallevel and their planting experience reveal insignificance on farmers’standardization decisionbehavior, which coule be explained by the smaller survey samples.4. Most of farmers’crop earnings improved significantly because of standardizationproduction selection.40%of farmers believe standardization production leads their cropincome less than10%, while60%of farmers insist standardization production affects theircrop income siginificantly, which growth rate reaches10-30%. A Cumulative LogitRegression Model (CLRM) is developed for analyzing crop income effects of standardizationproduction. The results show that the following factors have significant effects on farmers’crop income, which include scientific and technologic information provided by agriculturalcoorperative organization (ACO), new standard information propagated by government,postharvest commercialization of agricultural products and fair transaction in the market.Factors such as age, traditional planting ideology have negative impacts on farmers’ cropincome after them implementing standardized agricultural production. While factors like technical training, the main agricultural inputs offered by ACO are less significant in terms offarmers crop income improved.5. The empirical study clearly shows that agricultural standards play an important role inenhancing agricultural production efficiency. An extended Cobb-Douglas production model isemployed. Per capita agricultural output value is selected as dependent variable, and percapita amount of agricultural inputs, the collection of agricultural standards and the collectionof agricultural patent applications, these three variables are taken as independent. The modelexamines that all level of agricultural standards, whether local agricultural standards ornational standards, both could improve agricultural productivity, while agricultural patentsmakes less contribution to agricultural economic growth. This may be explained that Chinafamily farming does not meet the conditions of agricultural patents application.6. Agricultural standardization could facilitate local agricultural products exportingtrade.This paper select seven factors as explained variables, which stand for the level ofagricultural development, the level of agricultural technology innovation and the level ofagricultural standardization, respectively. By the Principal Component Regression (PCR)analysis, agricultural patents make the most contribution to export trade.The variables onagricultural standardization,such as the national agricultural standard and the number ofnational agricultural standardization demonstrations,promote local agricultural exportsignificantly,while the local agricultural standards prevent local agricultural exportingtrade.This could be explained that local standards mainly meet the requirements of localagricultural produntion,but the export-led agribusiness seldom adopts these standards.