IDEAS home Printed from https://ideas.repec.org/p/wpa/wuwpdc/0502022.html
   My bibliography  Save this paper

Accounting for Agricultural Decline with Economic Growth in Taiwan

Author

Listed:
  • Ling Sun

    (Providence University)

  • Lilyan E. Fulginiti

    (University of Nebraska)

  • E. Wesley Peterson

    (University of Nebraska)

Abstract

In this paper we propose an empirical model to decompose the evolution of the agricultural GDP share of Taiwan into three components: price changes, factor endowment changes and technological change. The full sample period is 1967 to 1997. The data were first tested to assess whether the time series are nonstationary and cointegrated. After confirming their nonstationarity and cointegrated relation- ship, we then employ an error correction model (ECM) in the empirical estimation to capture the dynamic as well as long-run equilibrium relationship among those economic variables. The results suggest that relative prices have a positive influence on the share of agriculture in GDP in both the long-run and the short-run. An increase in capital per unit of labor, on the other hand, is associated with a smaller agricultural share. This result is consistent with the Rybczynski Theorem. Technical change has been biased in favor of this sector. The strong negative impact of the change in factor endowments seems to dominate any possible positive effect of relative prices and technical change. This result makes a strong case for a Heckscher-Ohlin type model as a basis of understanding the development of the Taiwanese economy.

Suggested Citation

  • Ling Sun & Lilyan E. Fulginiti & E. Wesley Peterson, 2005. "Accounting for Agricultural Decline with Economic Growth in Taiwan," Development and Comp Systems 0502022, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpdc:0502022
    Note: Type of Document - pdf; pages: 27
    as

    Download full text from publisher

    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/dev/papers/0502/0502022.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Jacob L. Weisdorf, 2006. "From domestic manufacture to Industrial Revolution: long-run growth and agricultural development," Oxford Economic Papers, Oxford University Press, vol. 58(2), pages 264-287, April.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Saenz, Mariana, 2010. "Structural Change in the Colombian Coffee Sector: 1975-2007," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 61462, Agricultural and Applied Economics Association.
    2. Tey, (John) Yeong-Sheng, 2008. "The Relative Decline of Agriculture in China," MPRA Paper 15057, University Library of Munich, Germany.
    3. Esposti, Roberto, 2014. "On why and how agriculture declines," Structural Change and Economic Dynamics, Elsevier, vol. 31(C), pages 73-88.
    4. Roberto ESPOSTI, 2007. "On the Decline of Agriculture. Evidence from Italian Regions in the Post-WWII Period," Working Papers 300, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.

    More about this item

    Keywords

    Taiwan; productivity growth; GDP function; error correction;

    JEL classification:

    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture

    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:wpa:wuwpdc:0502022. 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: (EconWPA). General contact details of provider: https://econwpa.ub.uni-muenchen.de .

    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.