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Optimal Chinese Agricultural Trade Patterns under the Laws of Comparative Advantage
CARD Working Papers
  • Dermot J. Hayes, Iowa State University
  • Frank H. Fuller, Iowa State University
Publication Date
Series Number
99-WP 233
The gradual liberalization of Chinese economic sectors and the associated growth in the income of Chinese consumers in recent years has created interest in how China will influence world agricultural markets should it decide to liberalize its food sector. Using Chinese agricultural and resources data and an adaptation of the Heckscher-Ohlin-Vanek international trade model, Hayes and Fuller project what Chinese trade, production, and consumption patters would be if China allowed the laws of comparative advantage to direct production and trade decisions. They show that today's Chinese agriculture is dramatically different from what would have evolved had it been open to trade and factor mobility. In particular, the use of capital is many times lower than it would otherwise be, and the use of labor is many times greater.
Publication Information

Agricultural trade, Chinese agriculture, comparative advantage, Heckscher-OhlinVanek model

Citation Information
Dermot J. Hayes and Frank H. Fuller. "Optimal Chinese Agricultural Trade Patterns under the Laws of Comparative Advantage" (1999)
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