An analysis of the effect of farmland transfer subsidy policy: from the perspectives of crowding-out effect, government rent-creation and objective deviation

SHANG Xudong1 ZHU Shouyin1

(1.Modern Agriculture Research Center, Agricultural Management Institute of Ministry of Agriculture)

【Abstract】The implementation of subsidy policy to promote farmland transfer and operation scales in agriculture is of wide concern in the urbanization process. After reviewing the relevant literature on the formation of farmland transfer subsidy policy in China and international experience, this article summarizes the main contents and short-term positive effects of farmland transfer subsidy policy in China. It carries out a theoretical analysis of some negative effects induced by the implementation of farmland transfer subsidy policy, and verifies the crowding-out effect of farmland transfer subsidy policy on small and medium-sized business entities by establishing an econometric model using the survey data. The study shows that, concomitant with short-term positive effects in the implementation of farmland transfer subsidy policy, some negative effects are inevitable. The policy implementation leads to transfer premium that is beneficial to the outflow party for rent seeking, produces a crowding-out effect on small and medium-sized business entities and self-crowding in transfer transactions on large-scale business entities, and becomes club products, causing a social welfare loss and a failure to achieve social consensus. In addition, the farmland transfer subsidy policy would facilitate a negative incentive to maintain land productivity and make transfer subjects keen on the epitaxial development model of scale expansion, which is neither conducive to the stable and orderly development of operation scales in agriculture, nor to the protection and maintenance of national food security. Long-term policy supports to promote the development of operation scales in agriculture would still need to be explored.

【Keywords】 farmland transfer; subsidy policy; crowding-out effect; government rent-creation;

【DOI】

【Funds】 General Project of the National Social Science Fund (17BZZ026) Soft Science Research Project of Ministry of Agriculture (K201720-1) Youth Project of Beijing Social Science Foundation (16SRC027)

Download this article

(Translated by LI Mengling)

    References

    1. Du, Z. Macroeconomic Management (宏观经济管理), (5) (2006).

    2. Fan, H. Economic Geography (经济地理), (3) (2010).

    3. Han, Q. & Zhang, J. Inquiry into Economic Issues (经济问题探讨), (9) (2012).

    4. He, X. Journal of Nanjing Agricultural University (Social Science Edition) (南京农业大学学报(社会科学版)), (11) (2011).

    5. Huang, J., Yan, L. & Ji, X. et al. China’s Farmland System, Farmland Transfer, and Farmland Investment (中国的农地制度、农地流转和农地投资). Shanghai: Truth & Wisdom Press, (2012).

    6. Huang, X., Chen, J. & Chen, X. Journal of Northwest A&F University (Social Science Edition) (西北农林科技大学学报(社会科学版) ), (2) (2014).

    7. Ke, B. Management and Administration on Rural Cooperative (农村经营管理), (3) (2015).

    8. Li, H. Modern Economic Research (现代经济探讨), (9) (2015).

    9. Li, G. Rural Economy (农村经济), (3) (2017).

    10. Li, X. & Zong, Y. International Comparison of Agricultural Subsidy Policy (农业补贴政策的国际比较). Beijing: China Agricultural Science and Technology Press, (2012).

    11. Luo, B. & Wu, C. Journal of Agrotechnical Economics (农业技术经济), (2) (2008).

    12. Ma, Z., Meng, J. & Han, Y. Public Financial Research (财政研究), (3) (2010)

    13. Shang, X., Chang, Q. & Wang, S. China Population, Resources and Environment (中国人口·资源与环境), (8) (2016).

    14. Shang, X. & Han, J. Reform (改革), (8) (2016).

    15. Shang, X. & Zhu, S. Reform (改革), (2) (2017).

    16. Wang, W. Economist (经济学家), (3) (2017).

    17. Xiao, D. China Land Sciences (中国土地科学), (12) (2010).

    18. Xiong, H. Rural Economy (农业经济), (11) (2004).

    19. Yao, Y. Social Sciences in China (中国社会科学), (2) (2000).

    20. Zhang, J. Journal of Central University of Finance & Economics (中央财经大学学报), (11) (2007).

    21. Zhao, D. & Wu, Y. Issues in Agricultural Economy (农业经济问题), (7) (2011).

    22. Siciliano, G., 2012, “Urbanization Strategies, Rural Development and Land Use Changes in China: A Multiple-level Integrated Assessment”, Land Use Policy, 29(1): 165–178.

This Article

ISSN:1006-4583

CN: 11-3586/F

Vol , No. 06, Pages 43-56

November 2017

Downloads:5

Share
Article Outline

Abstract

  • 1 Introduction
  • 2 Literature review
  • 3 Main content, policy mix and short-term positive effects of China’s farmland transfer subsidy policy
  • 4 Negative effects of China’s farmland transfer subsidy policy: theoretical analysis
  • 5 Validation of negative effects of China’s farmland transfer subsidy policy: crowding-out effect on small and medium-sized business entities
  • 6 Conclusions
  • References