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Grain subsidy, liquidity constraints and food security—Impact of the grain subsidy program on the grain-sown areas in China

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  • Yi, Fujin
  • Sun, Dingqiang
  • Zhou, Yingheng

Abstract

This study examined the effects of China’s grain subsidy program, the largest food self-sufficiency project of all developing countries, on grain-sown areas within the context of liquidity constraints. A large household-level panel was used to evaluate how the subsidy program affected the cultivation schedule of farm households through the relaxation of households’ liquidity constraints over a given period. Results suggest that, in general, the grain subsidy program improved farm households’ grain planting areas in liquidity-constrained households. This finding provides a more comprehensive understanding of the effects of China’s grain subsidy than previous studies have.

Suggested Citation

  • Yi, Fujin & Sun, Dingqiang & Zhou, Yingheng, 2015. "Grain subsidy, liquidity constraints and food security—Impact of the grain subsidy program on the grain-sown areas in China," Food Policy, Elsevier, vol. 50(C), pages 114-124.
    • Handle: RePEc:eee:jfpoli:v:50:y:2015:i:c:p:114-124
    DOI: 10.1016/j.foodpol.2014.10.009
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