Resource Center

Advanced Search
Technical Papers
Working Papers
Research Memoranda
GTAP-L Mailing List
CGE Books/Articles
Important References
Submit New Resource

GTAP Resources: Resource Display

GTAP Resource #2808

"Modeling Agricultural Domestic Support Policy in China: recent policy reversals and two hypothetical future scenarios"
by Yu, Wusheng and Hans Grinsted Jensen

This paper reviews recent development of China’s agricultural domestic support policy, especially the switch from taxing farmers and agriculture to providing direct subsidies to grain production and purchased inputs. A model-based quantitative analysis on the effects of these policy changes has been conducted. Simulation results suggest that recent policy changes likely have positively addressed two of the declared policy objectives in increasing grain production and boosting farm income. Much of the increase in grain production and farm income can be attributed to land reallocation to grain production, cheaper inputs, and extra agricultural employment triggered by the policy changes.

Judging from the rural-urban and west-east income gaps in China, the diminishing role of agriculture in China’s economy, and the current political environment, it is expected that the tax cut will be permanent and that government assistance to agriculture and farmers will continue and rise. Two hypothetical future scenarios are simulated. If China uses up all its WTO de minimis support allowances and an assumed Blue Box cap in a manner consistent with its current practices, increased grain production, changing trade pattern seemingly contrary to China’s comparative advantage, increased rural employment, and significantly higher farm income (over 16%) will be expected. If alternative, decoupled payments are provided, China’s agricultural production and trade will remain unchanged, rural employment stays stable. But as a way of transferring income, the decoupled payments will be more efficient.

Resource Details (Export Citation) GTAP Keywords
Category: 2008 Conference Paper
Status: Published
By/In: Journal of Agricultural Economics Vol. 61, No. 2, 2010, 343–368; presented at the 11th Annual Conference on Global Economic Analysis, Helsinki, Finland
Date: 2010
Created: Jensen, H. (4/18/2008)
Updated: Yu, W. (6/19/2011)
Visits: 2,413
- Domestic policy analysis
- Agricultural policies
- Asia (East)

If you have trouble accessing any of the attachments below due to disability, please contact the authors listed above.

Public Access
  File format 2008 Conference Paper  (325.0 KB)   Replicated: 0 time(s)

Restricted Access
No documents have been attached.

Special Instructions
No instructions have been specified.

Comments (0 posted)
You must log in before entering comments.

No comments have been posted.