Dynamic Agricultural Supply Response Under Economic Transformation: A Case Study of Henan, China

Abstract

During the dramatic economic transformation in the last few decades, food demand in China has expanded due to rapid urbanization, dietary change, and steady population growth. At the same time, a decline in available land for agriculture has made grain selfsufficiency,a major goal of Chinese agriculture policy, a considerable challenge. The governmenthasimplementedcomprehensivepolicies to encourage domestic agricultural production, including eliminating agricultural taxes and providing direct subsidies to farmers. It remains unclear whether these policies are effective in stimulating food production.There isanurgentneedforknowledgeonagricultural supply response to changes in prices, policies and rural infrastructure in China, which can guide policy formulation in the process of economic transformation. If agriculture is highly responsive,policy-induced changes in farmers’ behavior can be effective in increasing production and ensuring long-term food security in the country.