New Zealand Journal of Agricultural Research abstracts

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Analysing levels of China’s agricultural domestic support with an optimising model

Lingxian Zhang¹

Daoliang Li¹

Weisong Mu¹

Jun Yue^1,2

Zetian Fu^1,*

¹College of Information & Electrical Engineering
China Agricultural University
PO Box 209
17 Qinghua Donglu
Haidian District, Beijing, 100083 China

²College of Management
Ludong University
Yantai, 264006 China

^*Author for correspondence: fzt@cau.edu.cn

Abstract    The paper analyses the impacts of alteration of agricultural domestic supports on state welfare adopting partial equilibrium theory. In order to find out the appropriate levels of agricultural domestic supports in China, a nonlinear programming approach was utilised, based on constraints of the annual financial budget and the Uruguay Round Agreement on Agriculture, to build an optimisation model for levels of China agricultural domestic support was built to aim at the maximum welfare. The result shows that the maximum levels of China “amber box” support are 50 billion dollars from welfare maximisation in the international agricultural product trade. The amber box support is about 174 billion RMB yuan according to the de minimis levels of China with 8.5%. The national annual budgetary expenditure for agriculture was 175.445 billion RMB yuan approximately in 2003, the amber box support of which was only 55.143 billion RMB yuan.

Keywords    agricultural domestic support; China; optimisation model; partial equilibrium; welfare; WTO

A07074; Online publication date 17 December 2007; Received and accepted 10 August 2007

New Zealand Journal of Agricultural Research, 2007, Vol. 50: 647–654
0028–8233/07/5005–0647 © The Royal Society of New Zealand 2007

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