The Transmission of World Food Commodity Prices to China Markets: 2006-2008
Posted: 24 Sep 2009
Date Written: September 24, 2009
This paper examines the world price transmission to China for four food commodities (maize, rice, soybeans and wheat) during the recent food commodity prices spike (2006-2008). To understand the world price transmission to China for the food commodities, the author conduct econometric analysis using the error-correction model (ECM) with monthly data. Estimations suggest that the price transmissions are weak, and China’s prices of these four commodities are relative stable. With an analysis from the policy perspective, the author concludes that the weak transmission is attributed to China’s domestic agriculture support policies.
Keywords: Agricultural Policy, China, Food Commodity Prices
JEL Classification: C22, O24, Q11
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