Technical Efficiency in China's Agricultural Production in the Period 1985-1995

Abstract

The paper uses data of 29 provinces in China from 1983 to 1995 to estimates the effects of cultivated land, mechanical area, and market factors such as prices, natural conditions and agricultural investment on agricultural output during this period. The estimated results show that a substantial proportion of the variation of China’s agricultural output during the period 1985-1995 is due to technical inefficiency. The cultivated land, farmers’ agricultural investment, agricultural terms of trade and adverse weather are main reasons that can explain the slowdown of China’s agricultural growth from 1985 to 1995.The findings of the study are significant because they involve problems of urbanization, the property right of land or economies of scales, the terms of trade and environmental degradation, which causes environmental pollution, can influence the sustainability of agricultural production. Therefore, the promotion of agricultural reforms, reducing adverse effects of urbanization and improving technical efficiency will contribute to improving China’s agricultural productivity.