Agricultural support and spatial price transmission: evidence from China’s maize sector

Jiawu Dai, Yuchen Feng, Yan Wang and Xiuqing Wang

International Food and Agribusiness Management Review, 2022, vol. 26, issue 2

Abstract: A market-oriented reform of China’s 2016 Temporary Purchase and Storage Policy (TPSP) is important for improving the price-forming mechanism of maize. Using monthly, province-level panel data and a dynamic spatial econometric model, this study distinguishes the heterogeneous spatial price transmissions of maize under officially supportive and market-oriented regimes. Our empirical results show that the spatial transmission of maize prices was remarkably distorted under the TPSP. Simultaneously, its market-oriented reform has greatly reduced regional price differences and generated a more flexible and much smoother spatial price transmission. The reform provides important insights for improving agricultural support regimes for other products in China.

Keywords: Demand; and; Price; Analysis (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:ags:ifaamr:335092

DOI: 10.22004/ag.econ.335092

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