Purpose
The purpose of this paper is to examine whether Chinese pork reserve regulation policy fulfills its function in stabilizing market prices and simultaneously to theoretically and empirically analyze the causes leading to the failure of Chinese Government’s intervention in the market, especially in the context of asymmetric pork and hog price information transmission.
Design/methodology/approach
A modified Reserve-Cobweb model based on the competitive storage model developed by Muth in 1961 is employed to examine the transmission effect of hog and pork prices under the setting of Chinese Government’s pork reserve regulation policy, using the data on Chinese hog and pork prices from June 2009 to June 2015.
Findings
While the Reserve-Cobweb model provides theoretical insights, suggesting that the implementation of the government’s reserve policy tool to control price volatility actually leads to increased price volatility, the empirical results indicate that the policy induces hypercorrection and impels greater price volatility, especially in the context of existence of asymmetric price information transmission.
Social implications
The Chinese Government should reduce excessive pork price intervention and instead allow the market to play its role in the hog and pork markets.
Originality/value
This paper develops a modified Reserve-Cobweb model based on the price transmission effect on different links within the agricultural products supply chain, which is used to empirically validate the existence of asymmetric price information transmission between pork and hog price in China.
This paper develops one model to explore the relationship between the subsidy policy and the agricultural total factor productivity (TFP). It indicates that the agricultural TFP will be lower after the subsidy policy is implemented and there exists a negative relation between the subsidy and TFP, if subsidies are associated with the acreage. Using Malmquist index, this paper measures the changes of TFP in China's cotton production before and after the subsidy policy is implemented. The results verify that the subsidy policy could not increase but decrease the TFP of China's cotton production, not only in the whole country but also in major provinces of China. Based on the positive study, some policy implications are provided in the end of this paper.
Land is the basic resource for human society; which constant in nature and not an increasing resource. Usually, arable land is used for residential, industrial, municipal, and civilization purposes which tends to affect agricultural productivity. The aim of this study is to investigate the efficiency of arable land protection policies of China and Pakistan, learning lesson for sustainable development. Time series data of arable land hectares per person, percentage of agricultural GDP growth rate, percentage of industrial GDP growth rate, percentage of forest area, and urban population annual growth rate were used to elaborate empirical results. The study result shows that in China the percentage industrial GDP growth rate and percentage of agricultural GDP growth rate have a positive and significant relationship with arable land hectares per person similarly, the land protection policies have a positive and significant relationship with arable land hectares per person. In Pakistan, findings show that there is no arable land protection policies by the government. The GDP growth rate and urban population growth rate have a positive relationship with arable land hectares per person, due to fellow land is utilizing time by time for cultivation purposes. Moreover, results show there was a breakpoint in trend of arable land loss in China from 1991, due to development of arable land protection policies of China, which revels that the arable land protection policies are efficient to control loss of arable land. The study giving a lesson to Pakistan for sustainable development with control to land loss.
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