Organization modes of industry chain, market power and agricultural industry chain financing: an empirical analysis based on data collected from 397 large-scale peasant households in Jiangsu Province

ZHOU Yueshu1,2 WANG Jie1

(1.College of Finance, Nanjing Agricultural University)
(2.Rural Finance Development of Jiangsu Research Center, Nanjing Agricultural University)

【Abstract】Under the background of the transformation of the agricultural management mode and rural financing reform, this paper uses the sample data collected from 397 large-scale peasant households in Jiangsu Province and employs the Heckman two-stage model and Tobit model to analyze the impact of the organization modes of the industry chain and market power on the financing scale of the large-scale peasant households’ industry chain. The empirical result has shown that the organization modes of the industry chain driven by leading enterprises or cooperative economic organizations have exerted a positive impact on the internal and external financing scale of the agricultural industry chain acquired by large-scale peasant households. The study further measures the impact of large-scale peasant households’ market power on the financing scale of their industry chains from the perspectives of bargaining power and the substitution degree. The result has indicated that the stronger market power the large-scale peasant households have, the more easily they can get the internal financing of the agricultural industry chain. The analysis has also found that the factors including large-scale peasant households’ planting and breeding area, present value of fixed assets and stable income or not have significant effects on the scale of the external financing of the industry chain, while the factors including education years of the head of a household, management types and trade credit conditions have significant effects on the scale of the internal financing of the industry chain.

【Keywords】 organization modes of industry chain; market power; agricultural industry chain financing; large-scale peasant households;

【DOI】

【Funds】 Theyouth project of National Natural Science Foundation of China (71403077) The project of humanities and social science research foundation in the Fundamental Research Funds for the Central Universities of Nanjing Agricultural University (SKCX2017008) The Qinglan Project in Jiangsu Province

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    Footnote

    [1]. ①Trade credit refers to the debtor-creditor relationship between buyers and sellers formed in the process of deferred payment or advances on sales. It is noteworthy that some objects in the industry chain may have cash loans. Since trade credit and bank credit are relative concepts, and cash loans belong to direct financing provided by the trade objects based on mutual trust, this paper classifies cash loans among the industry chain objects as trade credit. [^Back]

    [2]. ① Source: http://www.moa.gov.cn/zwllm/tzgg/tfw/201303/t20130321_3369453.htm [^Back]

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This Article

ISSN:1002-8870

CN: 11-1262/F

Vol , No. 04, Pages 46-58

April 2017

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Article Outline

Abstract

  • 1 Introduction
  • 2 Theoretical analysis and research hypothesis
  • 3 Data source and model setup
  • 4 Model estimation results and explanations
  • 5 Main conclusion and inspiration
  • Footnote

    References