Abstract
The primary goal of Chinese agricultural development is to guarantee national food security and the supply of major agricultural products. Hence, the improvement of agricultural technology plays a vital role in China for economic development. Technological change in agricultural sector results in higher future economic growth as well as food security, both in food consumption and availability. By constructing China’s agriculture general equilibrium model (CGE), this paper explains the impact of agricultural technology change. This paper constructs a dynamic CGE model based on CHINAGEM model for analyzing the technology increase in China Agricultural sector and then describes the construction of database and policy scenario. Model such as Computable General Equilibrium (CGE) model is used to conduct analysis of the economy-wide impacts of new agricultural technologies in China. In the general equilibrium model, some external variables are established; any part of structural changes caused by its exogenous variables can affect the entire system, resulting in general changes of goods, prices and quantity of factor. Simulation result of this paper indicates the agriculture sector output increases respectively; employment decreases; production cost decreases; and investment increases. Finally this paper describes the effects of the policy of technology changes by comparing policy scenario to baseline scenario and explains the impact of technology changes in China economy using CHINAGEM model.
Highlights
China was a great agriculture-dominated nation, with splendid techniques and high land productivity in the world
CHINAGEM is a recursive dynamic Computable General Equilibrium (CGE) model was developed from the Monash model (Dixon & Rimmer, 2002)
Since the 1990s, the MONASH model has been applied in economic policy analysis on a broad range of issues in Chinese economy such as to analyze tax reform; contributions of various economic sectors; fiscal relationships between federal and regional governments; forecasting greenhouse gas emissions, regional employment; employment and wage policies; and macroeconomic policies
Summary
China was a great agriculture-dominated nation, with splendid techniques and high land productivity in the world. Under the opening and reform policies of the 1980s and 1990s, the agricultural sector of China grew rapidly It has provided adequate food stuff to the large people, and played important role in the national economic development. Technological change has played a major role in the development of the agricultural sector in China. The reform of Agricultural sector resulted in increase in agricultural production, increase in food consumption quality and quantity, and reduction of poverty. Improvements in technology have by far contributed the largest share of crop production growth even during the early reform period. According to BEIJING (Reuters), the Agricultural Development Bank of China, one of the country’s main policy lenders, agreed to loan at least 3 trillion yuan ($450 billion) by 2020 for the modernization of China’s agriculture industry. This paper builds a conclusion based on policy simulation results and give future suggestions
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