Abstract: Out of the purpose of molding image projects of modern agriculture, some local governments are actively promoting large scale transfer of arable land to enterprises. However, the agricultural enterprises have two inherent weaknesses: the difficulty in supervision and stimulation and the weak quality of agriculture, which render the agricultural enterprises difficult to form large scale agricultural production capability. There are many malpractices in large scale transfer of arable land to enterprises; therefore, transfer of arable land should be mainly turned to farmers with scale operation rather than the industrial and commercial enterprises. The experiences at home and abroad and many case studies have also proved it. At present, it is necessary to change this idea of transferring arable land to enterprises, the supervision of transferring arable land to industrial and commercial enterprises should be strengthened and the risks should be prevented, and the policy favoring the large scale transfer of arable land to enterprises should be abandoned.

Key words: local government; preferential policy; weakness of agriculture enterprise; principal-agent; family farm