This study on the factors increasing farm household income disparity focusses on particular subjects in order to identify the causes of the polarization of rice farmers in terms of the areas they cultivated. By concentrating on the relationship between this polarization and the large-scale farmer development policy, the following points were identified.
As a result of studying the changes in cultivation area of the same farmers drawn from the panel data constructed from the “Farm Household Economy Survey” between 2003 and 2007, it became evident that the polarization of the cultivation area of farmers was caused by the downsizing of medium-scale farm households along with the further expansion of large-scale farm households. A probit analysis using the “Farm Household Economy Survey” derived the impact of characteristics such as cultivation area, age of business owner, educational background, gender, leased area ratio, and region on the rates of scale expansion and scale reduction of farm households. The results demonstrated a notable impact of cultivation area, age of business owner, and leased area ratio. It was also identified that, even disregarding the impact of characteristics other than cultivation area, the rate of expansion of size of large-scale farm households and the rate of shrinkage of medium-scale farm households were both high.
As a reason for the high rate of expansion observed among large-scale farm households, the shift in agricultural policies from medium-scale farmer development to large-scale farmer development has created the foundation for easy expansion for large-scale farm households. An indicator of this is the wide gap found in the expansion rate centering on 3 hectares; ever since the government announced the“ Exclusive Rice Specific Farm Development Plan” in 2004, large-scale farm households with over 3 hectares of cultivated land have become the pivot point of the policy. Furthermore, a reason for the high rate of reduction observed in medium-scale farm households is that large-scale farmers have a slowed reduction due to increased introduction of machinery from agricultural equipment purchase support programs while reduction pressures equally overwhelmed large and medium-scale farm households against the backdrop of the decline in the price of rice.
In consideration of the above analysis, this study concludes that the success of the government policy of prioritizing large-scale farmers caused a polarization of cultivation land among rice-growing farm households and consequently led to the widening of disparity in agricultural income and farm household income.
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