Agricultural Productivity, Structural Change, and Economic Growth in Post-Reform China

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Citation

Cao, Kang Hua & Birchenall, Javier A. (2013). Agricultural Productivity, Structural Change, and Economic Growth in Post-Reform China. Journal of Development Economics, 104, 165-80.

Abstract

We examine the role of agricultural productivity as a determinant of China's post-reform economic growth and sectoral reallocation. Using microeconomic farm-level data, and treating labor as a highly differentiated input, we find that the labor input in agriculture decreased by 5% annually and agricultural TFP grew by 6.5%. Using a calibrated two-sector general equilibrium model, we find that agricultural TFP growth: (i) accounts for the majority of output and employment reallocation toward non-agriculture; (ii) contributes (at least) as much to aggregate and sectoral economic growth as non-agricultural TFP growth; and (iii) influences economic growth primarily by reallocating workers to the non-agricultural sector, where rapid physical and human capital accumulation are currently taking place.

URL

http://dx.doi.org/10.1016/j.jdeveco.2013.06.001

Reference Type

Journal Article

Year Published

2013

Journal Title

Journal of Development Economics

Author(s)

Cao, Kang Hua
Birchenall, Javier A.