Research On The Contract Arrangement And Enforcement Of Farmland Transfer In China

Given the rapid progress of industrialization and urbanization,farmland transfer is urgently required to optimize resource allocation and realize moderate scale management,which is critical for facilitating modern agriculture development and further transformation of economic structure.Under the background of the reform of farmland system,namely the separation of contract rights and managerial rights under the ownership of collectives,the increase in the number and complexity of farmland transfer call for effective governance mechanisms urgently.Contract is the governance structure of transaction,providing an institutional basis for ensuring the predictability,stability and reliability of the transaction of farmland transfer.Refining the contract arrangement of farmland transfer provides an effective way for the protection of farmers'rights,the restriction of subjects' behavior,the construction of the risk sharing mechanism and the improvement of contract enforcement efficiency.It is of great significance to carry out in-depth study on the contract arrangement of farmland transfer.Theoretically.it provides a possible bridge for the local application of contract theory under the framework of China's farmland system.In practice,it can also provide useful reference for the contract arrangement of farmland transfer,and provides targeted policy implications for establishing a sound market of farmland transfer in the perspective of transaction governance.Based on the theory of contract economics,considering the practical exploration of rural economic development and farmland system arrangement in China,a comprehensive analysis is conducted with the method of empirical analysis and case study.This research identifies the main characteristics and constraints of farmers'decision-making of farmland transfer,examines the enforcement cost constraints and incentive mechanism of subjects' behavior involved in the contract rent arrangement,explores the differences in contract forms and effective self-enforcement mechanisms.and analyzes the allocation of residual rights and risk in the arrangement of farmland share cooperative contracts.Based on the systematic analysis of the contract arrangement of farmland transfer,we aim to provide useful inspiration for protecting farmers' rights,resolving contract enforcement risks,and provide beneficial enlightenments for the improvement of the arrangement of the contract system of farmland transfer.The specific research contents and corresponding conclusions and policy implications are as follows:First of all,farmers' participation in farmland transfer is the premise of contracting.The transferred scale and its constraints determine the characteristics of the transaction and the corresponding contract form.The behavioral characteristics and constraints in the decision of farmland transfer determine the characteristics of transaction and the matched contract form.The empirical results based on Bivariate Tobit model show that there is a correlation between the decisions of transferring out and transferring in.The transferring-out scale is restricted by the productive value and security function of farmland,and the transferring-in scale mainly depends on the path dependence of agricultural production and government subsidy.Farmers' viability promotes the increase of the transterred scale.With the increase of viability,the logic of farmers'decision-making changes from survival purpose to economic rationality.Under the ambiguity of property rights and uncertain farmland transfer market,reasonable contract arrangement lays the institutional basis of farmland transfer.The analysis of the determinants of farmland transfer decision of contract subjects is the premise of the research of contract arrangement of farmland transfer.Secondly.rent form is the core of the contract arrangement of famland transfer.Under the constraint of enforcement cost,the implication of contract rent arrangement to provide incentives and share risks and the role played by the farmland property rights system need to be clarified.Based on the survey data of farmland transfer contract in Chengde City,Hebei Province,the empirical results of Logit model show that the contract rent form depends on the trade-off between restricting moral hazard and contract enforcement cost.Share contract is more likely to be adopted when the enforcement cost is lower.The policy of farmland rights confirmation endows farmers with land property rights and income rights,encouraging farmers to adopt share contract to share revenues of farmland transfer.There is no significant evidence of the influence of farmers' risk attitude on rent form.A plausible reason is the equivalence of demographics of farmers leads to a convergence of risk attitudes of both sides.Thirdly,the incentive in contract rent arrangement cannot be achieved without appropriate enforcing mechanism.Informal contract is a useful supplement to the formal system in rural social environment.The self-enforcing mechanism of informal contract supplies way to reduce the risk of breach of contract.Based on the survey data of farmland transfer contracts in Chengde City,the empirical results of multivariate discrete selection model and Heckman probit model show that farmers choose informal contracts because of their trust in informal rules of social networks and the need for saving transaction cost.Farmers5 reputation and social networks are effective self-enforcing mechanism for informal contract of farmland transfer,which promote the contract enforcement through increasing the cost of default establishing invisible supervision and building relationship governance with trust and reciprocal relationship.The interaction of reputation and social network shows that the depreciation effect of reputation in closer social network is stronger to promote contract enforcement.The last case study is based on the analysis of contract rent arrangement and enforcing mechanism of farmland transfer contract.Given the incomplete contract arrangement of farmland property right,the allocation of residual control and residual claim rights determines the distribution of income and risk between contract parties.Reasonable allocating the residual rights in the contract of farmland stock cooperation is the fundamental way to realize farmers income rights and share risks.The case study on the contract arrangement of the farmland stock cooperation in Erxingying village in Chengde City shows that,the institutional arrangement of confirming property right and stock share in farmland stock cooperative system realize the stabilization of the contracting rights and the centralization of the management rights.Clarified farmland property rights ensures farmers' income rights to farmland through the stock share distribution.The establishment of contract chain consisting of company,cooperatives and peasant endows the residual controls to agricultural enterprise and transfer the natural risk faced by farmers.The combined rent form of fixed rent and share interests is adopted to ensure farmers' fixed income as well as endow farmers with the residual claim rights of farmland management,so as to realize the income and risk sharing of farmland scale management and capitalization.Compared with the previous studies,this research is based on the review of the contract theory and the summary of relevant Chinese contract studies of farmland transfer,and thoroughly investigates the issue of contract arrangement of farmland transfer.Innovative contributions are made mainly in research ideas,research methods and research perspectives.The innovation of research idea lies in investigating the characteristics of farmland transfer transaction and its contractual governance mechanism by decomposing the whole transaction process.The analysis includes the analysis of ex-ante contract signing,contract content arrangement and the ex-post contract enforcement,which is different from the previous studies examining only one segment of the contract or regarding contract as a whole.The contribution of research method firstly lies in the application of the Bivariate Tobit model to examine the relevant farmers' decisions of farmland transfer in and transfer out.Different from the previous analysis examining the two decisions separately,the analysis based on this model is helpful for accurately identifying behavior characteristics and decision preferences of contract parties.Secondly,the application of Heckman Probit model for analyzing the self-enforcing mechanism of contract eliminates the endogenous bias caused by the sample selection problem.The innovation of the research perspective first lies in considering the background of the ambiguous arrangement of farmland property rights in current collective farmland ownership in China,and analyzing farmland transfer contract in the perspective of property rights transaction.Secondly,the innovation lies in explaining the implications of the allocation of residual rights and risks in farmland stock cooperative system contract arrangement from the perspective of residual rights distribution in incomplete contracts.On the one hand,for the studies on farmland stock cooperative system,it provides supplements for the existing perspective of clarifying property rights or increasing farmers' income by investigating the allocation of residual rights.On the other hand,the research on the special transferred form and its contract arrangement provides supplements for the previous studies focusing on leasing contract of farmland transfer.