A Study On Non-Agricultural Employment’s Effects On Aricultural Production

Since China’s reform and opening up, there is a large number of rural labor force out for non-agricultural jobs. Choosing non-agricultural jobs, farmers not only improve their domestic income, but also promote the development of the second and third industries, but at the same time in some areas of the countryside there appeared these phenomena such as abandoning arable lands, aging and feminization of agricultural labor force which are not conducive to agricultural production. Many scholars have extensive researches on the issue that what kind of effects does the rural labor force’s non-agricultural employment have on agricultural production. A positive view is that the increase in non-farm income enables farmers to have more funds for agricultural investment, promoting agricultural production in a capital-labor substitution way; the negative view is that non-agricultural employment makes rural human capital inputs and agricultural capital stock decline, which are negative to agricultural production; and there is also the view that non-agricultural employment did not cause the decline in agricultural production. We can see that the conclusions on this issue varied. It has important guiding significance for China to develop rational agricultural production and labor transfer policies if we can understand the relationship between the non-agricultural employment and agricultural production correctly.This study based on the theory, from a theoretical point of view to sort out the mechanisms of how non-agricultural employment influencing agricultural labor and capital inputs as well as agricultural outputs, and then made use of China Health and Nutrition Examination Survey data, using statistical methods and econometric models, from the micro empirical analytical view to figure out non-farm employment’s effects on agricultural production.First, the study analyzed the relations between non-agricultural employment and agricultural production in a descriptive way, and the preliminary conclusions are as follows: non-agricultural employment and agricultural production inputs and outputs existed no obvious trend. Then, by further analysis, comparison between full-time farmers and part-farmers in agricultural production inputs and outputs showed that:there is no significant difference between full-time farmers and part-farmers in agricultural labor inputs, which indicating that because of the existence of rural surplus labor force,non-farm employment did not produce a significant effect on labor input in agriculture. At the same time, the differences in agriculture capital investment are significant while it remained opposite in agricultural output between them.We then established econometric models to test whether the results of capital and output are due to non-agricultural employment. The models showed that:the effects of the two indicators of non-agricultural employment, the proportion of non-agricultural income and the proportion of non-agricultural employment time have on capital investment in agriculture were not significant; other controlled variables, for example:the agricultural product price index, household income and regional dummy variables have significant effects on capital investment in agriculture, meanwhile the impacts the price of agricultural productive materials, domestic labor force are not significant. Integrated the effects of non-agricultural employment having on agricultural labor and capital, its effect on agricultural output is not significant which can be induced from a logical inference.Meanwhile, the impact of the two indicators of non-agricultural employment, the proportion of non-agricultural income and the proportion of non-agricultural employment time have on capital investment in agriculture were not significant; other control variables, for example:the agricultural product price index, household income and regional dummy variables have significant impacts on capital investment in agriculture, meanwhile the impacts the price of agricultural productive materials, domestic labor force are not significant. Integrated the impacts of non-agricultural employment having on agricultural labor and capital, its effect on agricultural output is not significant. Finally, this study established a model of agricultural output to further validate the inferred results, and the result was consistent with the inferred.Based on the above conclusions, this paper raises some policy recommendations related to the promotion of agricultural production and rural labor transfer.