The Microcosmic Mechanism and Empirical Test of Uncertainty on the Non-Linear Fluctuation of Chinese Grain Prices-Based on the Perspective of Global Economic Policy Uncertainty

Junguo Hua, Hui Li, Zejun He (), Jing Ding and Futong Jin
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Junguo Hua: College of Economic and Management, Henan Agricultural University, Zhengzhou 450000, China
Hui Li: College of Economic and Management, Henan Agricultural University, Zhengzhou 450000, China
Zejun He: College of Economic and Management, Henan Agricultural University, Zhengzhou 450000, China
Jing Ding: College of Economic and Management, Henan Agricultural University, Zhengzhou 450000, China
Futong Jin: College of Economic and Management, Henan Agricultural University, Zhengzhou 450000, China

Agriculture, 2022, vol. 12, issue 10, 1-17

Abstract: The dramatic fluctuations in grain prices and the threat to grain security caused by global economic policy uncertainty have been a social concern and a challenging area for price management authorities to regulate. Based on general equilibrium analysis in microeconomics, this paper constructs a mathematical model of the impact of global economic policy uncertainty on grain price fluctuation. It then examines the micro mechanism of non-linear grain price fluctuation under the dominant market mechanism and measures the non-linear shock effect of global economic policy uncertainty on grain prices using a threshold regression model. The results show that soybean and corn prices are subject to a two-zone fluctuation pattern due to global economic policy uncertainty. The impact has significant non-linear characteristics and is significantly greater in the high zone than that in the low zone. Accordingly, this paper offers government departments advice on better regulating and managing the market supply and demand and smoothing out sharp fluctuations in grain prices caused by changes in global economic policies.

Keywords: non-linear wave; grain price; global economic policy uncertainty; threshold regression models (TR); Chinese grain market (search for similar items in EconPapers)
JEL-codes: Q1 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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