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Changes in Chinese Competitiveness in Major Food Products: Implications for WTO Membership

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  • Ziping Wu
  • Ken Thomson

Abstract

Chinese entry to the WTO in December 2001 marks a new phase in agricultural trade, both nationally and globally. After a context review of Chinese agriculture and WTO-related policy issues, this paper first uses a Balassa index approach to examine China's relative competitiveness in some major food products over the period since 1985, followed by an analysis of price-cost ratios and production cost structures for these products. It is found that China has revealed comparative advantages in meat products but disadvantages in cereals. With limited land resources, its production and trade competitiveness has declined despite rapid substitution of capital for labour, due to a marked rise in relative labour price in agriculture. In the long run, it is expected that WTO membership will boost Chinese agricultural trade, but its impact on competitiveness will probably depend more on production costs, and will differ between crops and animal products.

Suggested Citation

  • Ziping Wu & Ken Thomson, 2003. "Changes in Chinese Competitiveness in Major Food Products: Implications for WTO Membership," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 1(1), pages 117-130.
  • Handle: RePEc:taf:jocebs:v:1:y:2003:i:1:p:117-130
    DOI: 10.1080/1476528032000039776
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    References listed on IDEAS

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    1. Alan Matthews, 2001. "The Possible Impact of China's WTO Membership on the WTO Agricultural Negotiations," CEG Working Papers 200110, Trinity College Dublin, Department of Economics.
    2. Albert Park & Hehui Jin & Scott Rozelle & Jikun Huang, 2002. "Market Emergence and Transition: Arbitrage, Transaction Costs, and Autarky in China's Grain Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(1), pages 67-82.
    3. Shujie Yao & Zinan Liu, 1998. "Determinants of Grain Production and Technical Efficiency in China," Journal of Agricultural Economics, Wiley Blackwell, vol. 49(2), pages 171-184.
    4. Kerr, William A., 2000. "Enter The Dragon: China'S Accession To The Wto," CATRN Papers 12891, Canadian Agri-Food Trade Research Network.
    5. McErlean, Seamus & Wu, Ziping, 2003. "Regional agricultural labour productivity convergence in China," Food Policy, Elsevier, vol. 28(3), pages 237-252, June.
    6. Kerr, William A. & Hobbs, Anna L., 2001. "Taming the Dragon: The WTO After the Accession of China," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 2(1).
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    Cited by:

    1. McErlean, Seamus & Wu, Ziping, 2003. "Regional agricultural labour productivity convergence in China," Food Policy, Elsevier, vol. 28(3), pages 237-252, June.

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