Influence of contract commitment system in reducing information asymmetry, and prevention and control of livestock epidemics: Evidence from pig farmers in China

The prevention and control of infectious diseases in livestock is of great significance for maintaining the food and health of people. The main bottleneck in preventing and controlling the epidemic is asymmetrical information between farmers and the livestock department regarding dead livestock. In this pursuit, China has levied the contract commitment system to ensure farmers to cooperate with livestock departments, cooperative organizations, and other farmers by proper contract in order to combat the livestock epidemic by reporting the status of dead livestock on time. Based on the data of 514 pig farmers in Hebei, Henan, and Hubei, this research employed the Heckprobit model to explore the contract commitment system's effect on pig farmers' behavior in reporting the status of dead livestock. The outcome showed that the contract commitment system encouraged the farmers to report dead pig information promptly. Moreover, modern information channels such as mobile phones or the Internet further enhanced the contract commitment system's effectiveness. Besides, the impacts of the contract commitment system on different scale farmers are found substantially heterogeneous. Based on the empirical findings, it is confirmed that the contract commitment system should not exclude government regulatory measures and economic incentive policies. It is a useful remedy to encourage farmers to report dead livestock information on time and supports in preventing and controlling livestock epidemics. Additionally, the government should enhance and strengthen the contract commitment system, establish the channels and platforms required to deliver necessary information about epidemics, and implement differentiated policy programs for different scale farmers. More importantly, these countermeasures can also provide important guidelines for other developing countries, facing livestock epidemics.