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How a price‐support policy can hurt the environment: Empirical evidence from Northeast China

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  • Jian Chen
  • Xiaohui Tian
  • Jialing Yu

Abstract

During the corn stockpiling system reform in Northeast China between 2008 and 2015, corn production expanded dramatically, and corn residue, which was mostly burned in‐situ, caused severe air pollution issues. Using a difference‐in‐differences approach, we assessed the effects of the corn stockpiling system reform in China and its associated environmental outcomes with a provincial‐level dataset. Our results suggest that the implementation of this policy significantly increased annual corn production in Northeast China by 15.1%. We also observed a substitution pattern between corn and soybean cultivation in the treatment area, with a percentage point increase in the net soybean‐to‐corn profit ratio leading to a decrease in corn production by 0.023 percentage points. Overall, based on changes in crop patterns during the system reform, increased straw resulted in increased burning and the resulting consequence to the environment is a net pollution increase equivalent to 16.03%, 0.33%, and 3.64% of the smoke and dust, SO2, and NOX, respectively, from the industrial sector in the treatment provinces. Lors de la réforme du système de stockage du maïs dans le nord‐est de la Chine entre 2008 et 2015, la production de maïs a connu une croissance spectaculaire et les résidus de maïs, qui étaient pour la plupart brûlés in situ, ont provoqué de graves problèmes de pollution atmosphérique. En utilisant une approche des doubles différences, nous avons évalué les effets de la réforme du système de stockage de maïs en Chine et ses résultats environnementaux associés à l'aide d'un ensemble de données au niveau provincial. Nos résultats suggèrent que la mise en œuvre de cette politique a considérablement augmenté la production annuelle de maïs dans le nord‐est de la Chine, de 15,1 %. Nous avons également observé un modèle de substitution entre la culture du maïs et celle du soja dans la zone de traitement, avec une augmentation d'un point de pourcentage du ratio de profit net soja/maïs entraînant une diminution de la production de maïs de 0,023 point de pourcentage. Dans l'ensemble, sur la base des changements dans les modèles de culture au cours de la réforme du système, l'augmentation de la paille a entraîné une augmentation du brûlage et la conséquence qui en résulte pour l'environnement est une augmentation nette de la pollution équivalente à 16,03 %, 0,33 % et 3,64 % de la fumée et de la poussière, SO2¬ , et NOX¬, respectivement, du secteur industriel dans les provinces de traitement.

Suggested Citation

  • Jian Chen & Xiaohui Tian & Jialing Yu, 2024. "How a price‐support policy can hurt the environment: Empirical evidence from Northeast China," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 72(2), pages 131-148, June.
    • Handle: RePEc:bla:canjag:v:72:y:2024:i:2:p:131-148
    DOI: 10.1111/cjag.12351
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