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Efficiency and Technological Progress in the Chinese Agriculture: the Role of FDI

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  • Li, Quan
  • Wahl, Thomas I.

Abstract

This study analyzes the role of foreign direct investment in contributing to regional differences in productive efficiency in Chinese agriculture. We use a stochastic frontier production function model, explicitly incorporating foreign capital, to investigate the relative performance of the aggregate agricultural sector across provinces and over time. Thus we can determine if foreign direct investment policies might reasonably be expected to change the competitive environment of regional agricultural sector. We calculate an index of productive efficiency and estimate the determinants of regional variations in it.

Suggested Citation

  • Li, Quan & Wahl, Thomas I., 2004. "Efficiency and Technological Progress in the Chinese Agriculture: the Role of FDI," 2004 Annual meeting, August 1-4, Denver, CO 19940, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea04:19940
    DOI: 10.22004/ag.econ.19940
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    References listed on IDEAS

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    1. Battese, G E & Coelli, T J, 1995. "A Model for Technical Inefficiency Effects in a Stochastic Frontier Production Function for Panel Data," Empirical Economics, Springer, vol. 20(2), pages 325-332.
    2. Meeusen, Wim & van den Broeck, Julien, 1977. "Efficiency Estimation from Cobb-Douglas Production Functions with Composed Error," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 18(2), pages 435-444, June.
    3. Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, vol. 6(1), pages 21-37, July.
    4. Fare, Rolf & Shawna Grosskopf & Mary Norris & Zhongyang Zhang, 1994. "Productivity Growth, Technical Progress, and Efficiency Change in Industrialized Countries," American Economic Review, American Economic Association, vol. 84(1), pages 66-83, March.
    5. Kumbhakar, Subal C & Ghosh, Soumendra & McGuckin, J Thomas, 1991. "A Generalized Production Frontier Approach for Estimating Determinants of Inefficiency in U.S. Dairy Farms," Journal of Business & Economic Statistics, American Statistical Association, vol. 9(3), pages 279-286, July.
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    Cited by:

    1. Justice Gameli Djokoto, 2013. "Trade Openness and Technical Efficiency Change in Ghana’s Agriculture," Journal of Empirical Economics, Research Academy of Social Sciences, vol. 1(1), pages 1-10.
    2. Furqan Sikandar & Vasilii Erokhin & Hongshu Wang & Shafiqur Rehman & Anna Ivolga, 2021. "The Impact of Foreign Capital Inflows on Agriculture Development and Poverty Reduction: Panel Data Analysis for Developing Countries," Sustainability, MDPI, vol. 13(6), pages 1-22, March.

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