Incentives or restrictions: policy choices in farmers’ chemical fertilizer reduction and substitution behaviors[A theory of social custom, of which unemployment may be one consequence]

Based on 804 samples of farmers in Hubei Province, a typical major grain-producing area in China, this study empirically analyzed the effects of two different policy tools, i.e. economic incentives (subsidies) and order enforcements (regulatory restrictions), as well as the effects of their interaction, on farmers’ chemical fertilizer reduction and substitution behaviors. Samples were grouped according to the degree of concurrent employment to analyze the effects on different groups. The results show that (1) the influences of these policies on the behaviors were significantly positive; (2) after constructing the interactive variables of the policies, the influence of the order enforcement policy was no longer significant, but the influence of the interaction was significantly positive; (3) the low-degree concurrent employment farmers were more likely to be affected by the order enforcement policy, whereas the high-degree ones were more affected by the economic incentive policy; and (4) the behaviors of the low-degree ones were strongly affected by family management characteristics, whereas the high-degree ones were more affected by the farmers’ individual characteristics.