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Will China's WTO Accession Worsen Rural Poverty?

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  • Anderson, Kym
  • Huang, Jikun
  • Ianchovichina, Elena

Abstract

Many fear China’s accession to WTO will impoverish its farmers, via greater import competition in its agricultural markets. We explore that possibility bearing in mind that, even if producer prices of some (land-intensive) farm products fall, prices of other (labour-intensive) farm and non-farm products could rise. New estimates, from the global, economy-wide numerical simulation model known as GTAP, of the likely changes in agricultural and other product prices as a result of WTO accession are drawn on to examine empirically the real income implications of China’s WTO accession. The results suggest farm/non-farm income inequality may well rise within China but rural-urban income inequality need not. The Paper concludes with some policy suggestions for alleviating any pockets of farm household poverty that may emerge as a result of WTO accession.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 4196.

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Date of creation: Jan 2004
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Handle: RePEc:cpr:ceprdp:4196

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Keywords: china's economic reform; income inequality; rural poverty; wto accession;

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References

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  1. Ianchovichina, Elena & Walmsley, Terrie, 2003. "The impact of China's WTO accession on East Asia," Policy Research Working Paper Series 3109, The World Bank.
  2. John Gilbert & Thomas Wahl, 2002. "Applied General Equilibrium Assessments of Trade Libereralisation in China," The World Economy, Wiley Blackwell, vol. 25(5), pages 697-731, 05.
  3. Elena Ianchovichina & Will Martin, 2004. "Impacts of China's Accession to the World Trade Organization," World Bank Economic Review, World Bank Group, vol. 18(1), pages 3-27.
  4. Scott Rozelle & Albert Park & Jikun Huang & Hehui Jin, 1997. "Liberalization and Rural Market Integration in China," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(2), pages 635-642.
  5. Zhang, Linxiu & Huang, Jikun & Rozelle, Scott, 2002. "Employment, Emerging Labor Markets, And The Role Of Education In Rural China," Working Papers 11969, University of California, Davis, Department of Agricultural and Resource Economics.
  6. Huang, Jikun & Rozelle, Scott & Martin, William J. & Liu, Yu, 2007. "Distortions to Agricultural Incentives in China," Agricultural Distortions Working Paper 48478, World Bank.
  7. Kym Anderson & Lee Ann Jacskon, 2004. "Standards, trade and protection: the case of GMOs," Centre for International Economic Studies Working Papers 2004-11, University of Adelaide, Centre for International Economic Studies.
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  9. Yaohui Zhao, 1999. "Leaving the Countryside: Rural-to-Urban Migration Decisions in China," American Economic Review, American Economic Association, vol. 89(2), pages 281-286, May.
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  12. Fan, Shenggen & Fang, Cheng & Zhang, Xiaobo, 2001. "How agricultural research affects urban poverty in developing countries: the case of China," EPTD discussion papers 83, International Food Policy Research Institute (IFPRI).
  13. Anderson, Kym, 1993. "Lobbying Incentives and the Pattern of Protection in Rich and Poor Countries," CEPR Discussion Papers 789, C.E.P.R. Discussion Papers.
  14. Kanbur, Ravi & Zhang, Xiaobo, 2001. "Fifty Years Of Regional Inequality In China: A Journey Through Revolution, Reform And Openness," Working Papers 7236, Cornell University, Department of Applied Economics and Management.
  15. Shaohua Chen & Martin Ravallion, 2004. "Welfare Impacts of China's Accession to the World Trade Organization," World Bank Economic Review, World Bank Group, vol. 18(1), pages 29-57.
  16. Schultz, Theodore W, 1975. "The Value of the Ability to Deal with Disequilibria," Journal of Economic Literature, American Economic Association, vol. 13(3), pages 827-46, September.
  17. Terry Sicular & Yaohui Zhao, 2002. "Earnings and Labor Mobility in Rural China: Implications for China's WTO Entry," University of Western Ontario, Economic Policy Research Institute Working Papers 20028, University of Western Ontario, Economic Policy Research Institute.
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Cited by:
  1. Chang, Min & Sumner, Daniel A., 2004. "Trade Impact On Food Security: Analysis On Farm Households In Rural China," 2004 Annual meeting, August 1-4, Denver, CO 20322, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

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