Essays on Economic Returns to Fertilizer, Market Structure of Milk Industry, and Air Pollution and Food Security in China

Abstract

Over the past four decades, China has made fruitful achievements in agricultural development, which attracted a great deal of attention within the academy. Meanwhile, Chinese agriculture has also undergone dramatic and continuing structural changes (Chen et al. 2009; Cao and Birchenall 2013), including the spatiotemporal change in crop patterns at the farm stage (Xin et al. 2012) and the structural change in food markets (Qian et al. 2011; Kong 2012). These changes will, no doubt, have impacts on food security, which is essential for political stability and social equity of the country. In addition, it is in full agreement that economic growth is associated with environmental pollution (Beckerman 1992; de Bruyn, van den Bergh and Opschoor 1998; Selden and Song 1994), and the agricultural development in China is no exception. Nowadays, agriculture has become one prime culprit of air pollution (Erisman et al. 2007; Bauer et al. 2016). In return, air pollution can not only affect plant growth and animal health but also influence both the quantity and quality of agro-inputs in the food supply chain and thereby affect food security indirectly (Sun, Dai, et al. 2017). Therefore, how to ensure food security in a sustainable manner has been becoming a primary concern for both scientists and policymakers. Inspired by the dramatic structural changes and environmental pollution issues accompanying the rapid agricultural development in China, this study is conducted to estimate the economic returns to fertilizers, to identify the market power for Chinese food industry, and to explore the relationship between air pollution and food security. Specifically, 1) given the fact that China’s cropping pattern has been shifting away from cereals and toward vegetables and fruits, we hence shed light on the effects of crop allocation on economic returns to chemical fertilizers in Chinese agriculture; 2) since the 2008 Chinese milk scandal led to an enormous structural change in Chinese dairy industry, we investigate the evolution of market power for Chinese fluid milk industry at the brand level; 3) in order to dig out the potential policy instruments to reduce air pollution while ensuring food security, we review the current literature on the relationship between air pollution and food security from the perspective of the food system; 4) after reviewing previous research, we find that there is very limited research addressing the effects of air pollution on food prices, we hence estimate the impact of air pollution on the short run prices of three major fresh food products (Chinese cabbage, tomatoes, and pork) in Beijing, China.