Impact of ChinaÂ’s WTO Accession on Farm-Nonfarm Income Inequality and Rural Poverty

Kym Anderson, Jikun Huang and Elena Ianchovichina

No 2002-11, Centre for International Economic Studies Working Papers from University of Adelaide, Centre for International Economic Studies

Abstract: Many fear ChinaÂ’s accession to WTO will impoverish its rural people, via greater import competition in its agricultural markets. We explore that possibility bearing in mind that, even if producer prices of some (land-intensive) farm products fall, prices of other (labour-intensive) farm products could rise. Also, the removal of restrictions on exports of textiles and clothing could boost town and village enterprises, so demand for unskilled labour for non-farm work in rural areas may grow even if demand for farm labour in aggregate falls. New estimates, from the global, economywide numerical simulation model known as GTAP, of the likely changes in agricultural and other product prices as a result of WTO accession are drawn on to examine empirically the factor reward implications of ChinaÂ’s WTO accession. The results suggest farm-nonfarm and Western-Eastern income inequality may well rise within China but rural-urban income inequality need not. The paper concludes with some policy suggestions for alleviating any pockets of farm household poverty that may emerge as a result of WTO accession.

Keywords: WTO accession; ChinaÂ’s economic reform; rural-urban income inequality (search for similar items in EconPapers)
JEL-codes: O19 O53 P31 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2002-11
References: View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Related works:
Journal Article: Will China's WTO accession worsen farm household incomes? (2004)
Working Paper: Will China's WTO Accession Worsen Rural Poverty? (2004)
Working Paper: Long-run impacts of China's WTO accession on farm-nonfarm income inequality and rural poverty (2003)
Working Paper: Impact of China’s WTO Accession on Rural-Urban Income Inequality (2002)
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