IDEAS home Printed from
   My bibliography  Save this article

The diminishing influences of agricultural output changes on general price changes in China


  • Xiaoyun Liu
  • Wanchun Luo
  • Xuefeng Mao
  • Xiuqing Wang
  • Xian Xin


Purpose - The paper aims to assess the impact of agricultural output changes on the general price level over time with China as an example. Design/methodology/approach - A simple numerical global general equilibrium (GE) model of two regions (China and the rest of the world) and three commodities (agriculture, manufacturing goods, and services) is used to assess the impacts of agricultural output changes on the overall economy price changes. The numerical GE model of this paper consists of production, final consumption, and market clear conditions. The results are generated with the GE model calibrated to aggregated China's input-output tables of 1987, 1997, and 2005. Findings - The results suggest that China witnessed a declining influence of agricultural output changes on general price changes. The contribution of given agricultural output change on the general price change in 2005 was merely less than 60 percent of that in 1987, which in turn implies that macro policies targeting to curb general inflation via boosting agricultural output will be less effective as those of 20 years ago. Practical implications - China's policy makers should rely less and less on promoting agricultural output policies to fight against general inflation and should resort to non-agricultural policies. Originality/value - The paper argues that the influence of agriculture on the China's general price indices has been weakening along with China's economic development with a numerical GE model calibrated to aggregated China's input-output tables of 1987, 1997, and 2005.

Suggested Citation

  • Xiaoyun Liu & Wanchun Luo & Xuefeng Mao & Xiuqing Wang & Xian Xin, 2010. "The diminishing influences of agricultural output changes on general price changes in China," China Agricultural Economic Review, Emerald Group Publishing, vol. 2(3), pages 345-355, September.
  • Handle: RePEc:eme:caerpp:v:2:y:2010:i:3:p:345-355

    Download full text from publisher

    File URL:
    Download Restriction: Access to full text is restricted to subscribers

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    1. Xian Xin & Xiuqing Wang, 2007. "Was China¡¯s Inflation in 2004 Led by An Agricultural Price Rise?," Working Papers 0702, China Agricultural University, College of Economics and Management.
    2. Ardeni, Pier Giorgio & Freebairn, John, 2002. "The macroeconomics of agriculture," Handbook of Agricultural Economics,in: B. L. Gardner & G. C. Rausser (ed.), Handbook of Agricultural Economics, edition 1, volume 2, chapter 28, pages 1455-1485 Elsevier.
    3. Xiwen Chen, 2009. "Review of China's agricultural and rural development: policy changes and current issues," China Agricultural Economic Review, Emerald Group Publishing, vol. 1(2), pages 121-135, January.
    4. Lin, Justin Yifu, 1992. "Rural Reforms and Agricultural Growth in China," American Economic Review, American Economic Association, vol. 82(1), pages 34-51, March.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Wenlang Zhang & Gaofeng Han & Steven Chan, 2014. "How Strong are the Linkages between Real Estate and Other Sectors in China?," Working Papers 112014, Hong Kong Institute for Monetary Research.
    2. Chan, Steven & Han, Gaofeng & Zhang, Wenlang, 2016. "How strong are the linkages between real estate and other sectors in China?," Research in International Business and Finance, Elsevier, vol. 36(C), pages 52-72.

    More about this item


    Agriculture; Inflation; Equilibrium methods; China; Input/output analysis;

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • Q10 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - General


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eme:caerpp:v:2:y:2010:i:3:p:345-355. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Virginia Chapman). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.