Abstract
Using a decomposition method, this paper proposes an analytical framework to investigate the mechanisms by which agricultural support policies affect farmers’ use of fertilizers in agriculture in China. The mechanisms are decomposed into “three effects” (structural, scale, and technological effects). It is found that China’s agricultural support polices have significantly contributed to the increased use of agricultural fertilizers through encouraging farmers to bring more land under cultivation (the scale effect). Meanwhile, some policies have also helped reduce fertilizer consumption when farmers were motivated to increase the area of grains crops (the structural effect). The role of technological progress in affecting fertilizer consumption (the technological effect) appears to be minimal and uncertain. Compared to direct subsidies, indirect subsidies play a much greater role in affecting farmers’ production decision making and are more environmentally consequential. This paper argues that some of China’s agricultural support policies are not well aligned with one key objective of the country’s rural policies—improving environmental sustainability. It is recommended that the government takes measures to reform agricultural support policies and to reconcile agricultural and rural policies in order to achieve sustainable rural development.
Highlights
From the 1990s, the issues facing China’s agricultural and rural sectors, which were encapsulated as sannong wenti by researchers [1], began to attract attention from both the media and policy makers
The overuse of agrochemicals has become an environmental concern in agricultural production, as it leads to degradation and the consequent declining productive capacity of natural resources and poses a great threat to ecosystems and human health [4,5]
We develop hypotheses on how agriculture support policies (ASPs) may affect farmer’s agrochemical use through entailing changes in the sown area of major crops and encouraging farms to adjust the structure of their farm and improve agricultural productivity, especially technological growth
Summary
From the 1990s, the issues facing China’s agricultural and rural sectors, which were encapsulated as sannong wenti (i.e., three issues respectively concerning agriculture, farmers, and the rural society) by researchers [1], began to attract attention from both the media and policy makers. To cope with the sannong wenti, the key policy objectives of the central government have included improving agricultural production and productivity, raising farmers’ income and reducing poverty, revitalizing the countryside, and (more recently) improving environmental sustainability. It remains a question how China, facing daunting challenges, will achieve all these goals with its agricultural and rural policies. These policies provide incentives to agricultural producers to stay in farming and put in more efforts and resources to increase production and productivity They could potentially lead to an increase in the use of agrochemicals.
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