Transaction Costs And Farmer's Marketing Channel Selection

The household contract responsibility system in agricultural production and market-oriented reforms of agri-products circulation system from late 1970s to early 1980s, make farmers become the basic organizational unit of agricultural production and circulation. However, there always has been contradiction between small production and large market in agri-products circulation. Low level of marketing constraints the development of the market circulation and rural economics, and the traditional thinking foucs on production, while neglect distribution, to a certain extent, restrict and impede the guiding role of agri-products circulation in the agricultural structure adjustment. Improve the marketing forms of Small-scale farmers can protect the farmers' interests and promote the liberalization of agricultural trade, this makes great significance to promoting agricultural and rural markets.This paper first reviews and summarizes the transaction costs research on agri-products' marketing channels by domestic and foreign scholars. Then choose the waxberry planters' market behavior as the research object, through the data, we try to identify the key factors for the choice of marketing channel. Finally, we hope to provide a theoretical basis for government when making regulations for agri-products.In this paper, we first review the development of waxberry industry in Zhejiang Province by using macro data, and then choose Xianju as the study area. After that a face to face interview was taken to 137 waxberry planters who were randomly selected from six different villages,125 effective questionnaires were obtained. Before making the model analysis, the author first analyze the circulation structure of waxberry at the point of value-added from the sample, the results show that the local organization of sales channel is in low degree, different channels exist big difference in value added. Then Tobit Model by surveyed data is taken to estimates the relative importance of various transaction costs for the choice of marketing channel. Empirical results indicate that unstable market price, concern on quality certification and the average of Single sales will urge farmers shift from retail channels to traders' channels and processing enterprises channels. While accessing to information before sale and far away from market will promote the choice of farmers in the retail channel. In addition, age of household head and cultivation scale also have significantly influence on farmer's choice of marketing channel.In order to improve the sales channel of waxberry and promote the development of agricultural circulation system, the policy implications based on statistics and empirical results is as followed:(1) Improve the degree of farmers'organization, promote the construction of modern sales channels, while gradually improve the traditional distribution system.(2) Promote the construct of processing enterprises, and guide their research into re-processed products. Make long-term cooperation between farmers and processing enterprises.(3) Increase the provision of public goods and institutional reforms.(4) Increase research and capital investment, strengthen the preservation technology of waxberry to meet the time requirements when sale and processing, thus partially offset the loss caused by perishable.