Policy Evaluation of Demonstration Cooperative Construction: Evidence from Sichuan Province, China

Agricultural cooperatives are professional organizations that increase farmers’ incomes through market failure corrections, livelihood resilience, and sustainable rural development. The main purpose of this paper was to evaluate the policy effects of the construction of demonstration cooperatives for farmers in China. The authors of this paper used the propensity score matching (PSM) method to evaluate the policy effect of the construction of demonstration cooperatives based on questionnaire survey data on 509 farmer cooperatives in 10 counties in Sichuan Province of China. On this basis, the inverse probability weighting-regression adjustment (IPWRA) method was used as a robustness test. The authors of this study were the first to systematically and comprehensively assess the policy effects of demonstration cooperatives while considering selectivity effects. The empirical results show that the Chinese government’s construction of demonstration cooperatives has significant policy effects, especially regarding policy support in improving the economic strength, service capacity, product quality, and social response of demonstration cooperatives. However, the policy effect of improving the democratic management of cooperatives is not significant. It is recommended that the government continue to strengthen policy support in improving the economic strength, service capacity, product quality, and social response of demonstration cooperatives. Simultaneously, more effective measures should be taken to promote the democratic management of model cooperatives.