The Influence Of Public Investment In Agricultural Research On Food Production Costs

In recent years, the ever-rising price of agricultural means of production and labor cost cause persistently high cost of food production. On the one hand, this leads to low benefit of agricultural production and management, reducing the farmers’motivation of food-growing; on the other, this slows down the speed of farmer income growth and weakens international competitiveness of China’s food products. So to reduce the cost of food production is in urgent need for promoting agricultural development. Many scholars point out that the key to lowering food production costs lies in the progress of technology. Through increasing investment of agricultural research and perfecting agricultural science and technology system, it can improve the effect of material inputs, decrease the material waste of unit production, optimize resource allocation structure, and therefore lead up to cost savings. From the point of farmers themselves, they also need cost-saving and income-raising techniques to help them not only improve agricultural output but also reduce the cost of food production. Based on this background, drawing on the achievements of previous researches and combining with theoretical analysis, the paper shows the changing characteristics of three types of food production costs and their internal structures, analyzing the changing conditions of the public investment in agriculture research in our country. And then the paper makes an exhaustive study on the influence of public investment in agriculture research on food production costs from two ways of time series data and panel data.Studying on the influence of public investment in agriculture research on food production costs has important theoretical and practical significance. It’s self-evident that agricultural research investment has an important role in increasing agricultural output, improving agricultural product quality, boosting agricultural productivity and so on. However, how the agricultural research investment influents food production costs remains to be fully explored all the time. Theoretically speaking, for one thing, the technological advances which are brought by agricultural research investment can expand the production-possibility frontier, improve the utilization rate of optimal resource, optimize the allocation of resources structure, then reduce the unit cost of agricultural products and save the cost of agricultural production. For another, the application of new technology is frequently associated with the corresponding levels of capital investment, which increases agricultural investment and speeds up the substituting capital for labor. Therefore, agricultural research investment may increase the cost of unit product. Throughout current literatures, most explain the influence of agricultural research investment on food production costs only from the qualitative perspective. The paper using empirical modeling method to analyze the influence of agricultural research investment on food production costs must be a beneficial complement to the existing literatures. Meanwhile, studying on the influence of public investment in agriculture research on food production costs can not only help understand the function of public investment in agriculture research lower food production costs, but also provide important decision-making references about how government leads and adjusts the direction of agricultural research investment, and it has great practical value.According to the technical line of theory to empirical measures, the paper adopts statistical analysis and comparative analysis as well as combination of qualitative and quantitative analysis, and then carries out the study as followings:looking up the literatures home and abroad and raising problem to be studied; reviewing relevant theories and looking for theoretical support; analyzing the changing conditions of three types of food production costs and their internal structures in China since1978and revealing the variation characteristics and regional differences; introducing the general situation of China’s agricultural research investment and dissecting the variation characteristics of public investment in agricultural research; constructing empirical models of time series data and panel data, analyzing the factors influencing China’s food production costs and its constitute elements and especially the influence of public investment in agricultural research on it; combining with the empirical conclusions and proposing some suggestions on the direction of public investment in agricultural research in the future accordingly.The paper reaches some main conclusions as follows:(1) the influence of public investment in agricultural research on food production costs is negligible, and it isn’t satisfactory for reducing food production costs directly;(2) public investment in agricultural research cuts down the cost of food production mainly by increasing the yield per unit area;(3) the prices of agricultural input factors have remarkable influence on heighten food production costs, and there is a great potential for lowering food production costs through pushing forward cost-saving agricultural technology progress;(4) grain production of our country has shown a trend of the substitution of capital for labor, and developing agricultural technologies of raising labor productivity and controlling labor cost is more and more important;(5) food production areas have big differences in saving material cost, labor cost and choosing agricultural technologies because of different natural conditions.The paper puts forward some countermeasures on how to bring government’s subjective initiative into guide the right direction of agricultural research investment as follows:(1) giving more financial support for agricultural research and improving agricultural research systems;(2) developing cost-saving and income-raising technological innovations and especially promoting the research of cost-saving techniques;(3) taking the balanced development of biological technologies and machinery technologies into account and paying more attention to labor-saving agricultural technology progress;(4) arranging the input of agricultural research expenditure and laying emphasis on the distribution and utilization efficiency of funds;(5) investing in the light of local conditions and promoting technical innovations of planting industry accordingly.