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Grain Policy in Chinese Villages: Yield Response to Pricing, Procurement, and Loan Policies

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  • Scott Rozelle
  • Richard N. Boisvert

Abstract

This paper assesses the effects of pricing, procurement, and loan policies on China's grain economy. A dynamic control model of the village leader is specified. Parameters of structural and control equations are estimated using time-series cross-section data. Simulation results show that pricing and procurement policies are not effective in raising yields, because of conflicting objectives of local officials. Loan policies can increase yields. The paper concludes that rural policies often have contradictory effects that can arise for a number of reasons. An important reason is the fact that local officials in a reforming economy have greater decision-making discretion than higher-level officials and execute policies to meet their own objectives.

Suggested Citation

  • Scott Rozelle & Richard N. Boisvert, 1993. "Grain Policy in Chinese Villages: Yield Response to Pricing, Procurement, and Loan Policies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 75(2), pages 339-349.
    • Handle: RePEc:oup:ajagec:v:75:y:1993:i:2:p:339-349.
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    File URL: http://hdl.handle.net/10.2307/1242918
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    Cited by:

    1. Lu, W. C., 2002. "Effects of agricultural market policy on crop production in China," Food Policy, Elsevier, vol. 27(5-6), pages 561-573.
    2. Yang, Weiyong, 2009. "Economic structural changes and rural income: Evidence from Chinese provinces during the reform period," China Economic Review, Elsevier, vol. 20(4), pages 742-753, December.

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