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An Empirical Study on the Dynamic Comparative Advantages of China’s Agricultural Products from the Perspective of WTO

Author: LuZuo
Tutor: LiGuCheng
School: Huazhong Agricultural University
Course: Economics
Keywords: Agricultural trade Dynamic comparative advantage Non-parametricEstimation Factor Endowments Trade Policy
CLC: F752
Type: Master's thesis
Year: 2013
Downloads: 5
Quote: 0
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Since its accession to the WTO, China’s agricultural products trade develops rapidly and continuously. China, as a large agricultural country, the development model of agricultural trade and comparative advantage of agricultural products directly related to China’s status in international trade patterns. However, comparative advantage is not a static, it changes dynamically over time. Therefore, dynamic comparative advantage of agricultural research on structure of China agricultural trade and avoid falling into the comparative advantage trap, improving agricultural trade policies, improving agricultural international competitiveness is of great significance. This paper aims to study dynamic changes and influence factors of comparative advantage of Chinese agricultural products, thereby forecasting development direction of China’s agricultural products trade, improving the agricultural products export advantage, discussing on optimization method of domestic trade policy in order to maintain stable, orderly, healthy and positive development of the market.The paper uses RSCA and latest NRCA index as indicators for measuring comparative advantages. Firstly, drawing1991-2001and2006-2011Scatter plots of RSCA indices of China’s agricultural products to preliminary estimates of20years various changes in comparative advantage of agricultural products and agricultural trade structure. Build a regression equation to verify the stability of the trade structure. Secondly, we construct a non-parametric model to analysis trade data of China’s agricultural product. Based on non-parameter estimation model describes the dynamic comparative advantage of agricultural trade trends, determine the fluidity and continuity of China’s agricultural products trade pattern on how to adjust trade structure so as to increase import and export of Chinese agricultural products advantage. Thirdly, specific studies on dynamic change and trends of land-intensive and labor-intensive agricultural product’s comparative advantage, analysis endowments and trade policy that influencing the comparative advantage. Finally, judge the impact level of endowments and trade policy factor on the dynamic comparative advantage of agricultural products, after China entered WTO. Explore China how to increase agricultural export advantage and enhance the international competitiveness of China’s agricultural products trade through trade policy.This study concluded that, during the1991-2011, most of China’s agricultural products do not have a comparative advantage. Before entering WTO, China had a low level of specialization of agriculture and strong liquidity of agricultural trade pattern. After entering WTO, the level of specialization of China’s agriculture improves, and agricultural trade pattern is become continuous. Due to the abundance of land and labor resources, China has a congenital agricultural product’s comparative advantage. Through statistical analysis, we found that, lack of capital, low education level of the workforce, as well as substances of agricultural scientific and slow technological progress will leading to lower agricultural productivity in China, hinder the promotion of comparative advantage of Chinese agricultural products. Studying on China’s trade policies, we found protection of Chinese agricultural products market is inadequate, facing competition in the international market, China’s agricultural products may be at a disadvantage and agricultural comparative advantage may disappear.According to the research findings, we offer some suggestions that China should reasonably implement China’s agricultural comparative advantage development strategy, optimize the agricultural support system, as well as agricultural products import and export policies, increase investment in agriculture, as well as focus on agricultural education and training of the work force.

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