IDEAS home Printed from https://ideas.repec.org/p/ags/aaea25/361012.html

U.S.-China Dairy Production Systems and Producer Subsidy: The Case of Twin Tariffs

Author

Listed:
  • Li, Youmin
  • Schmitz, Andrew
  • Weng, Weizhe

Abstract

The trade war was triggered by US concerns about the trade deficit, intellectual property theft, and unfair trade practices. This paper studied the far-reaching impacts of the U.S.-China trade war on agricultural trade dynamics, focusing on the Chinese dairy-livestock belt (primarily in Inner Mongolia) and U.S. agricultural competitiveness. According to time-series data from the China Dairy Association, the paper identified a marked decline in per capita milk production in Inner Mongolia and highlights the economic ripple effects of tariff policies on both nations. The imposition of tariffs on critical commodities, such as alfalfa, oats, and soybeans disrupted supply chains and escalated production costs for Chinese dairy farmers, while simultaneously reducing the global competitiveness of U.S. exports. The paper further analyzes various scenarios regarding tariff impacts and examines how subsidies mitigate the effects of twin tariffs. Results illusion that tariffs on inelastic goods disproportionately affect economic efficiency, leading to cascading supply chain issues.

Suggested Citation

  • Li, Youmin & Schmitz, Andrew & Weng, Weizhe, 2025. "U.S.-China Dairy Production Systems and Producer Subsidy: The Case of Twin Tariffs," 2025 AAEA & WAEA Joint Annual Meeting, July 27-29, 2025, Denver, CO 361012, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea25:361012
    DOI: 10.22004/ag.econ.361012
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/361012/files/Tariffs%20Impacts%20on%20China%20Dairy.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.361012?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Xiaohua Cheng & Difei Xu & Hui Sun & Meiyi Zheng & Jintao Li, 2022. "Rural Spatial Differentiation and Revitalization Approaches in China: A Case Study of Qingdao City," IJERPH, MDPI, vol. 19(24), pages 1-16, December.
    2. Bu, Di & Liao, Yin, 2022. "Land property rights and rural enterprise growth: Evidence from land titling reform in China," Journal of Development Economics, Elsevier, vol. 157(C).
    3. Schmitz, Andrew & Nguyen, Ly, 2022. "Seafood Supply and Demand Disruptions: The Covid-19 Pandemic and Shrimp," 2023 Allied Social Sciences Association (ASSA) Annual Meeting, January 6-8, 2023, New Orleans, Louisiana 316534, Agricultural and Applied Economics Association.
    4. Schmitz, Andrew & Nguyen, Ly, 2022. "Seafood Supply and Demand Disruptions: The Covid-19 Pandemic and Shrimp," 2022 Allied Social Sciences Association (ASSA) Annual Meeting (Virtual), January 7-9, 2022 316534, Agricultural and Applied Economics Association.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Qingen Gai & Zhiqiang He & Fangfang Su & Wencheng Zhao, 2026. "The Impacts, Mechanisms, and Patterns of China Rural Collective Economic Development With Common Prosperity for All," International Studies of Economics, John Wiley & Sons, vol. 21(1), pages 57-72, March.
    2. Mingyi Yan & Xizi Cao, 2024. "Digital Economy Development, Rural Land Certification, and Rural Industrial Integration," Sustainability, MDPI, vol. 16(11), pages 1-27, May.
    3. Dan Pan & Jinlong Zhou & Yi Yu & Shengdong Chen, 2024. "Rural Collective Property Rights System Reform and Urban-Rural Income Gap: A County-Scale Big Data Analysis in China," SAGE Open, , vol. 14(3), pages 21582440241, August.
    4. Xu, Guangyu & Chen, Huang, 2025. "Inclusive growth dilemma: Weighing the pros and cons of land market reform," China Economic Review, Elsevier, vol. 91(C).
    5. Liu, Shouying & Ma, Sen & Yin, Lijuan & Zhu, Jiong, 2023. "Land titling, human capital misallocation, and agricultural productivity in China," Journal of Development Economics, Elsevier, vol. 165(C).
    6. Haiyuan Wan & Weidong He & Kejun Xin & Yangyang Shen & Yangcheng Yu, 2026. "Effects of Agricultural Land Titling on Poverty Reduction in China," Journal of Agricultural Economics, Wiley Blackwell, vol. 77(1), pages 156-170, February.
    7. Liu, Songrui & Yu, Xiaokun & Zhang, Wenkang & Zhang, Zhongwen, 2026. "The lifespan of small and medium-sized enterprises in China: Stylized facts and influencing factors," China Economic Review, Elsevier, vol. 95(C).
    8. Nguyen, Ly & Schmitz, Andrew, 2022. "The Welfare Impacts of Covid-19 on U.S. Salmon Sector," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322351, Agricultural and Applied Economics Association.
    9. Xinmin Liu & Yue Zheng & Wencheng Yu, 2023. "The Nonlinear Relationship between Intellectual Property Protection and Farmers’ Entrepreneurship: An Empirical Analysis Based on CHFS Data," Sustainability, MDPI, vol. 15(7), pages 1-16, March.
    10. Huang, Wei & Luo, Mi & Ta, Yuqi & Wang, Boxian, 2024. "Land expropriation, household behaviors, and health outcomes: Evidence from China," Journal of Development Economics, Elsevier, vol. 171(C).
    11. Jinglin Jiang & Hongyu Xiang, 2024. "Leadership and Entrepreneurship: Evidence from a Chinese Household Survey," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 14(1), pages 1-2.
    12. Xu, Zhihua & Fan, Duolan & Chen, Ji & Li, Shuqin, 2025. "From policy to participation: Exploring the influence of property rights on rural revitalization efforts," Economic Analysis and Policy, Elsevier, vol. 86(C), pages 1660-1674.
    13. Pengfei Fan & Ashok K. Mishra & Shuyi Feng & Min Su, 2025. "From informal farmland rental to market‐oriented transactions: Do China's Land Transfer Service Centers help?," Journal of Agricultural Economics, Wiley Blackwell, vol. 76(1), pages 74-97, February.
    14. Zhai, Xin, 2025. "Rural collective property rights system reform, financial literacy, and rural household income," Finance Research Letters, Elsevier, vol. 85(PA).
    15. Zhiqiang Cheng & Jinyang Cai, 2024. "How do climate anomalies affect the duration of land transfers? Evidence from China," Climatic Change, Springer, vol. 177(10), pages 1-20, October.
    16. Chen, Ting & Gu, Jiajia & Ngai, L. Rachel & Wang, Jin, 2026. "Sowing Seeds of Mobility: The Gendered Impact of Land Reform," IZA Discussion Papers 18569, IZA Network @ LISER.
    17. Jing Li, 2026. "Big Hands Holding Small Hands: Assessing the Impact of Urban‐Rural Integration on Rural Enterprise Growth," Growth and Change, Wiley Blackwell, vol. 57(2), June.
    18. Sitong Pan & Qinghua Shi & Yue Zhang, 2025. "Platform economy and missing entrepreneurship: Evidence from E‐commerce development policy in China," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 33(2), pages 209-251, April.
    19. Ayesh, Abubakr & Hisam, Kulsoom & Lorenz, Aaron, 2025. "How Institutions and Bargaining Power shaped Indigenous Economies and Agriculture," 2025 AAEA & WAEA Joint Annual Meeting, July 27-29, 2025, Denver, CO 360987, Agricultural and Applied Economics Association.
    20. Song, Malin & Xie, Qianjiao & Shahbaz, Muhammad & Yao, Xin, 2023. "Economic growth and security from the perspective of natural resource assets," Resources Policy, Elsevier, vol. 80(C).

    More about this item

    Keywords

    ;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    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:ags:aaea25:361012. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.