Empirical Analysis of the Effects of the Chinese Soybean Target Price Policy

초록

Soybeans play an important role in Chinese agriculture; they are not only the main source of vegetable oil but also an important source of plant protein. This study examines the Chinese soybean target price subsidy, which is intended to effectively guarantee the basic income of farmers using a dataset containing information on 4 provinces that have implemented such policies as the treatment group and 23 provinces that have not as the control group from the China Rural Statistical Yearbook, an ongoing panel data from the year of 2004 to 2015. A difference-in-difference (DID) model was used to estimate the effect of the soybean target price policy on production and average production, showing that the soybean target price subsidy policy has not solved the problems of soybean production nor fundamentally addressed the issue of soybean reserves. The soybean target price subsidy policy guarantees the basic benefits of farmers, promotes production in the middle and lower levels of soybean culture, and has improved the market pricing mechanism, but there remain such problems as lower target prices, failure to promote farmers’ production, some unreasonable processes in the policiese unreasonab and inadequate subsidies. This research holds important theoretical and realistic significance by serving as a reference for other agricultural product price reforms.

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