Study On The Carryover Effect Of The Grain Direct Subsidy Policy In The Case Of Hongdong County Of Shanxi Province

Grain is an indispensable livelihood, which can be used as the basic ration, feed grain, industrial food and seeds food, it also is the most important strategic materials.China is a country of both large agricultural and large population, there are 710 million farmers, accounting for 53.4 percent of the total population in 2009, farm income is still the main source of farmer's income. Agriculture is a weak industry, relatively low interest, and the apparent lack of competitiveness compared to other industries. From the second half of 2006 to the first half of 2008, volatility in world food prices, triggering a series of political issue, makes governments pay more attention to their food security. Grain is the basic national survival, so our government should encourage farmers to grow grain, increase the income of grain farmers, and make it the top priority to promote grain production and ensure food security.Although the country gradually increase subsidies to grain farmers, it is indirect subsidies to subsidize circulation before 2004, it subsidies to grain farmers directly from 2004. With the implementation of direct subsidies in 2004, the price of agricultural production material have been rocketing,it rose so sharply that increases farmers planting costs, partially offset by the benefits of agricultural policies brought tangible benefits to farmers. It is an issue worthy of studying the relations of agricultural production material's price and farms' income. The article as an example of commodity grain base county of Shanxi Hongdong County, by analyzing the effect of direct subsidies to farmers' grain yield, plant areas and operating income of the family, mainly get two conclusions:Firstly, grain direct subsidy policy mobilizes farmers to grow grain, specifically in the grain production and increased acreage. By the establishment of food production and food production function model of acreage Logit model, using the EVIEWS5.0 and SPSS17.0 software analysis, grain direct subsidy policy for grain production and planting area has a significant positive impact.Secondly, grain direct subsidy policy increases farmers income, but the rising prices of agricultural production material, deducting price factors of agricultural production material, the effect of grain direct subsidy policy to increase families operating income is not significant. The analysis shows that grain direct subsidy policy to families operating income is a significant impact; agricultural production material price crowds 48.9% of the benefit which is received from the food rising price; farmer's profit from grain direct subsidy policy is account about 8% of families operating income.The innovation of this paper there are three aspects:First, the innovative of view, existing studies mostly from the perspective of empirical analysis, this paper is not only from empirical implementation, but also from the theory of economics method; the second is making the grain direct subsidy as a policy variable introduced into the econometric model, analysising the effect of grain direct subsidy to farmers grain production, acreage, families operating income, in order to determine the carryout effect; Third, the research has been basically proceed from the overall research policy implementation within a wide range of effects, but little research on the small area, so this research on the commodity grain base counties are very representative and feasibility.This paper also has shortcomings:First, just analysing the carryover effect of grain direct subsidy policy, not analysing the seed subsidies, farm machinery purchase subsidy and other favorable policies; the second is not analysis the effect of grain direct subsidy policy to grain growing on different scales, different geographical location, the impact of different irrigation farmers. These need further study later.