Research on Government Subsidy Strategies for the Development of Agricultural Products E-Commerce

Yaoguang Zhong, Ivan Ka Wai Lai, Fangfang Guo and Huajun Tang
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Yaoguang Zhong: School of Business, Dongguan Polytechnic, Dongguan 523808, China
Ivan Ka Wai Lai: Faculty of International Tourism and Management, City University of Macau, Macau 999078, China
Fangfang Guo: School of Economics and Management, Dongguan University of Technology, Dongguan 523808, China
Huajun Tang: School of Business, Macau University of Science and Technology, Macau 999078, China

Agriculture, 2021, vol. 11, issue 11, 1-27

Abstract: In many countries, the governments support the development of local agriculture through subsidization. Subsidizing the sales of agricultural products through E-commerce channels is a way to support the development of agriculture in China. This study aims to develop a profit model and apply Stackelberg game theory to determine which type of subsidies and decision-making can provide the maximum benefits for agricultural products E-commerce supply chains. The results indicate that for both centralized decisions and decentralized decisions, the subsidizing to the agricultural cooperative is better than the subsidizing to consumers and no subsidization. The sales volume, preservation level, sales efforts, and overall profit of the agricultural products E-commerce supply chain are significantly higher. It suggests that the government should play a leading role to support the development of agricultural products E-commerce. This study contributes to agricultural research by developing a profit model to examine the effects of different government subsidy strategies on each member of the agricultural online shopping supply chain. Recommendations are provided for agricultural cooperatives, E-commerce platforms, and the government to improve the quality and sales of agricultural products through online shopping channels.

Keywords: Stackelberg game; government subsidies; agricultural products supply chain; sales efforts (search for similar items in EconPapers)
JEL-codes: Q1 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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