Risk Aversion,Household Asset Allocation And Farmers' Entrepreneurial Choice

Since the reform and opening up,with the gradual prosperity of China's rural economy,more and more farmers have chosen the form of entrepreneurship as a new source of family livelihoods.Farmer entrepreneurship not only provides more consumer goods for families by creating additional wealth,but also diversified asset allocation to accumulate wealth more effectively.It also helps create employment opportunities in rural areas and promote the revitalization of rural communities.Entrepreneurial farmers are the most dynamic group of "new farmers" in the "Rural Revitalization Strategy" and an indispensable part of the human capital of "Mass Entrepreneurship and Innovation".However,Farmers still lack the enthusiasm to participate in entrepreneurship,and mainly exhibits problems such as low-level and marginalization.Although the government has introduced many preferential policies to promote farmers' entrepreneurship,such as transfer payments and inclusive credit,the overall effect is still limited.First,the psychological quality of farmers to deal with various risks of entrepreneurship is relatively weak,and the means of risk sharing is still mainly shared by family members,and the form is single.Second,credit exclusion has existed for a long time.The existing inclusive credit has not penetrated enough into farmer households and has failed to fundamentally break the habit of rural households relying on traditional household asset accumulation and optimization to achieve venture capital accumulation,and external resources are still blocked by the inside.Therefore,as a whole,the success rate of entrepreneurship is subject to both subjective and objective effects and it is still low.To solve the problem of entrepreneurship,we should start with the endogenous motivation of farmers."Risk Aversion" is an important subjective factor that affects farmers' entrepreneurial choices.Although the traditional view believes that a lower level of RA is related to entrepreneurship,in reality,risk tolerance and entrepreneurial practice are not inevitable.The intermediary object between risk attitude and behavior may affect the generation and exit of entrepreneurial practice.Some studies initially show that family assets are an important objective factor restricting Entrepreneurial Choices too.If family assets are both restricted by risk attitudes and affect Entrepreneurial Choices,then the process of asset processing by rural households is the preferred "explicit variable" between Risk Attitudes and Farmers' Entrepreneurial Choices.However,whether the level of farmers' RA will indirectly affect the Choice of Entrepreneurship through the impact of Household Assets is still unclear scientifically.This article is guided by exploring "whether the Household Asset Allocation(HAA)of peasant plays an intermediary role in the path of individual Risk Aversion(RA)influencing Farmers' Entrepreneurial Choices(FEC)",based on Risk Preference Theory,Planned Behavior Theory,Entrepreneurial Resource Theory and Family Asset Allocation Theory,and analyzes " The mechanism of family asset allocation as an intermediary effect has established a theoretical analysis framework of " Risk Aversion,Family Asset Allocation and Farmers' Entrepreneurial Choices ".Taking farmers from the three southwestern provinces as the research object,a sample of 669 effective rural households was obtained by a combination of stratified sampling and judgmental sampling.At the same time,German Socio-Economic Panel Method(SOEP),A Domain-Specific Risk-taking(DOSPERT)and The Bomb Risk Elicitation Task(BRET).The three methods measure the degree of Risk Aversion of family principals,clarify the status and differences of Household Asset Allocation of rural households before and after starting a business,and combine them with the Ministry of Agriculture's " National Rural Fixed Observation Point Survey Data " and " China Rural Statistics Official materials such as the Yearbook have investigated the history and current situation.Using a variety of econometric analysis methods,it first empirically analyzes the impact of Risk Attitudes on Farmers' Entrepreneurial Choices and farmers' Houshold Asset Allocation from the individual and family micro-scales,and then analyzes the effect of Asset Allocation on farmers' entrepreneurial choices.Following the mature thoughts of Baron & Kenny(1986)and Wen Zhonglin(2004)for intermediary effect testing,in view of the possible intermediary indirect effects of Household Asset Allocation,a causal step test and coefficient multiplier were carried out on the basis of combining the empirical results of the first two.After inspection,the following research conclusions were finally reached:(1)Based on the time dimension,it is found that the changes in household assets are similar to the historical evolution of rural entrepreneurship.The operating income of rural residents in three provinces,Sichuan,Chongqing and Guizhou,has increased by 246% over the past 15 years,and residential investment has increased by 351%.In particular,the level of productive asset holdings of rural households.The “original value of productive fixed assets” has increased by 1.6 times in 15 years,and the area of subcontracted cultivated land has increased by 2 times.The number of "people" has doubled.Therefore,the scale of productive assets of rural households has the same changing trend as that of farmers' entrepreneurship.(2)There are some differences in the results of different risk attitudes.In SOEP,27.65% of the results belong to the Low Risk Aversion group,and 16.89% of the results belong to the High Risk Aversion group.SOEP shows that the farmers surveyed tend to have a higher risk tolerance overall.Correspondingly,the BRET measurement results show that the farmers with Low Risk Aversion account for about14.65%,and on the contrary,the High Risk Aversion account for 36.62%.At the same time,the simple sum exponential distribution of DOSPERT shows that no samples are in the high group(Low Risk Aversion).Because the experimental risk attitude measurement is closer to reality it may be more accurate.The SOEP method tends to underestimate the risk aversion,while the Risk Aversion reflected by the BERT is more consistent with most theoretical predictions.(3)The degree of personal risk aversion of rural household principals significantly affects Farmers' Entrepreneurial Choices: The empirical results of SOEP,DOSPERT,and BRET are robust and consistent,indicating that farmers with Lower Risk Aversion are more likely to choose entrepreneurship,and the results are 0.418,respectively.1.303 and 0.032.Among them,entrepreneurial farmers with Low Risk Aversion are more inclined to adopt "entrepreneurship",and the results are about0.364,0.481 and 0.023 respectively.Comprehensive comparison of empirical evidence shows that Risk Aversion will affect entrepreneurial farmers' choice of“Portfolio Entrepreneurship”,but entrepreneurial farmers with higher risk tolerance will operate more projects.(4)Rural household asset allocation significantly affects farmers' entrepreneurial choices.The relationship is endogenous to the logical self-consistency of the Portfolio Theory and the entrepreneurial resources Theory.The allocation of family assets are a significant signal of entrepreneurial choice,and potential entrepreneurial farmers will convert low-risk,high-liquidity,and low-yield assets into low-liquidity assets,and choose to start a business to take high risks and achieve high income.The long-term path to optimal portfolio.Specifically,the risk asset allocation will be significantly greater than the marginal effect of whether farmers choose to start a business,about70%,the marginal effect on farmers to run more projects is 34%,and the marginal effect on the choice of "Starting business by enterprise” is about 60%.The interaction between different asset classes has a certain impact on entrepreneurial choice.This study believes that there are two types of paths,one is the indirect path,which mainly plays a role through the total level of the household's balance sheet.The second is the direct role,which is the direct and negative relationship between assets.The analysis results show that most of interactions affect the first-time entrepreneurial choice,but they are not sensitive enough to the industrial management choices and organizational choices after entrepreneurship.(5)There is indeed a "partial mediation effect" in the role path of "risk attitudes affecting farmers' entrepreneurial choices" in the allocation of family risk assets and liabilities.This shows that farmers with higher risk tolerance tend to increase the allocation of household production assets(BRET's measurement result parameter is0.0011),commercial real estate assets(BRET is 0.0108).They tend to use entrepreneurship to solve the problem of liquidity in the asset portfolio indicating that rural household may use entrepreneurship to overcome the barriers of Participation Puzzle.But intermediary effects do not exist in all asset types.For example,the mechanism of action of different risk assets is inconsistent,and no intermediary effect has been found in various types of production asset allocation(such as agricultural machinery,transportation vehicles,etc.).In addition,it is found that there is also an interaction between assets and risk attitudes and most of these variables have both an intermediary effect and a significant interaction effect.(6)The intermediary role of family asset allocation is more reflected in farmers' choice of “whether to start a business.” There are 7 types of asset allocation results that are significant.For entrepreneurial farmers who continue to expand their entrepreneurial options,there are at most 5 types of “family asset allocation” against There are mediating effects on attitudes affecting entrepreneurial choices;there are at most 4 asset types in the mediating effect of whether entrepreneurial farmers choose Portfolio entrepreneurship.The value and innovation of this article are mainly reflected in the following aspects:(1)This thesis applies the experimental scene control-based measurement method(BRET)to measure the Risk Aversion of individual farmers,and compares it with the subjective reporting Risk Aversion measurement methods SOEP and DOSPERT.More in line with theoretical predictions.On the one hand,the experimental method BRET can effectively alleviate the "self-understanding bias"problem commonly found in autonomous answering methods.Based on non-productive scenarios and currency-induced measures to measure farmers' general risk attitudes,the risk of traditional autonomous answering methods is the main factor.The attitude measurement method is a good complement;on the other hand,this study attempts to reproduce the experimental process of the PC platform using a smart mobile phone,and applies the experimental process to the farmer group through home surveys to achieve the transition from “lab to field” "Change.It is found that its scientific,low-cost and high-efficiency characteristics are widely applicable to the investigation of various types of people.Therefore,the research based on the risk attitude based on BRET in this paper is more accurate and reliable.(2)Based on two theories of Portfolio and Entrepreneurial Resources,creatively taking the logical commonalities of two as an embedded perspective,it successfully construct the mechanism process of "Household Asset Allocation affecting Entrepreneurship Choices".First,entrepreneurship is a typical risky activity.The conversion of household high liquid assets(such as savings assets)into specialized productive assets(such as breeding plants)with higher returns but lower liquidity,the key is to achieve a balance between high returns and high risks;second,Farmers can choose to start a business by adjusting Household Asset Allocation.Potential entrepreneurial farmers will tend to allocate a large number of low liquidity risk assets,especially productive assets.Therefore,the empirical analysis of the relationship between rural family Asset Allocation and Entrepreneurial Choice has broken the status quo in the past that only focused on certain types of asset stock and ignored the allocation effect in entrepreneurial research.(3)A theoretical analysis framework of "risk attitude,family asset allocation and farmers' entrepreneurial choice" was constructed.This study considers family asset allocation as an intermediary variable embedded in the basic role path of "risk attitudes affecting farmers 'entrepreneurial choices".Based on this framework,the empirical analysis of farmers' general risk attitudes first affects family asset allocation and then affects their entrepreneurial choices Cause and effect process.Based on the perspective of asset allocation,this research not only responds to the existing scientific debate on why some risk-loving farmers will not participate in entrepreneurship,but also shows that “rational farmers under restrictions will take entrepreneurial actions” to achieve long-term families A realistic path for optimal asset allocation.The above conclusions make a marginal contribution to answering the "Participation Puzzle."(4)This article extends the research on entrepreneurial choice to "what industry to create" and "how to start a business".In practice,how to further release the entrepreneurial potential of farmers and stimulate the vitality of small and micro enterprises in rural areas is the focus of public policy's next step.Existing literature has not explored many entrepreneurial farmers ' "re-enterprise",that is,expanding entrepreneurship,maintaining entrepreneurship,or exiting entrepreneurial options.In fact,it ignores the concern of the heterogeneity of entrepreneurial farmers' selection.This article uses "Portfolio entrepreneurship" to investigate what kind of farmers create a business,and chooses "starting business by creating enterprise" to examine how farmers start their own businesses.There is some novelty in the content of entrepreneurship research.This study combines risk attitudes and household asset allocation,not only examines the intermediary role of farmers' entrepreneurial reselection,but also extends the two paths of asset allocation to the research of entrepreneurial farmers' selection,expanding the depth and breadth of current Chinese farmers' entrepreneurial research.