Three Dimensional Contract Theory And Governance Mechanism In Agriculture

This article is based on three-dimensional contract theory and attempts to design a new type of contract chain which can suit the need of modern agriculture in our country to solve the problem. First, by focus on the most common agricultural contract-- single dimensional contract, namely, contract farming.I found that this kind of usual contract has the trait of endogenous instability. Secondly, I modeling three-dimensional contract theory by identify the trait of them. Thirdly, I design a modern agricultural contract chain of agricultural production, according to the main function of its production,the agricultural production is divided into a develop module, farming module processing module, sales module, each module is link by three dimensional contract with special governance mechanism, this agricultural contract chain is endogenous stable and cover the whole product chain.Finally,I prove this modern agriculture contract chain, not only has the better stability, but also can lower the price of agricultural production, raise the output and the income of all the production chain as the repeat of the game.