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Market liberalization and crop planting decision: a case of China

Author

Listed:
  • Suwen Pan
  • Jaime Malaga
  • Xiurong He

Abstract

Purpose - The paper aims to measure the effects of market liberalization on Chinese farmers' crop planting decisions. Design/methodology/approach - The effects are measured using a censored, two‐stage, least‐square regression. Findings - The results show that the effects of market liberalization on planting decisions are more significant in the case of crops with minimum support price (rice, wheat, and corn) than in the case of crops where planting decision is determined by market prices (cotton and soybean). The effects appear to be different across regions and time zones and more significant in 1993 than in 2005. Originality/value - The result suggests that market liberalization along the past ten years achieved significant effects in Chinese farmers planting decision. This outcome should be taken into consideration when evaluating and implementing future Chinese agricultural policy income‐based interventions as a means to meet domestic food security goals and increase farmers' income level.

Suggested Citation

  • Suwen Pan & Jaime Malaga & Xiurong He, 2010. "Market liberalization and crop planting decision: a case of China," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 2(3), pages 240-250, September.
    • Handle: RePEc:eme:caerpp:v:2:y:2010:i:3:p:240-250
    DOI: 10.1108/17561371011078408
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    References listed on IDEAS

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    1. Steven T. Yen & Biing-Hwan Lin, 2006. "A Sample Selection Approach to Censored Demand Systems," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(3), pages 742-749.
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    2. Yuquan W. Zhang & Jianhong E. Mu & Mark Musumba & Bruce A. McCarl & Xiaokun Gu & Yuanfei Zhou & Zhengwei Cao & Qiang Li, 2018. "The Role of Climate Factors in Shaping China’s Crop Mix: An Empirical Exploration," Sustainability, MDPI, vol. 10(10), pages 1-17, October.
    3. Jin‐Tao Zhan & Yan‐Rui Wu & Xiao‐Hui Zhang & Zhang‐Yue Zhou, 2012. "Why do farmers quit from grain production in China? Causes and implications," China Agricultural Economic Review, Emerald Group Publishing Limited, vol. 4(3), pages 342-362, August.

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