The impact of income growth on quality structure improvement of imported food: evidence from China 's firm-level data
China Agricultural Economic Review
ISSN: 1756-137X
Article publication date: 8 August 2020
Issue publication date: 22 September 2020
Abstract
Purpose
Against the background of the rapid increase of total imported food in China, China's imported high-quality food has increased more than low-quality ones, and China's imported food quality structure has continuously improved. It is a new issue that needs further examination.
Design/methodology/approach
Based on the assumption of non-homothetic preference, this paper apply the method provided by Eaton and Kortum (2002) in a new theoretical model and empirically analyzes the impact of per capita income on the quality structure of imported food by using SYS-GMM with firm import data from Chinese customs.
Findings
The study finds that income is a significant factor which affects the imported food quality structure in China. The higher the per capita income, the higher the imported food quality structure. Furthermore, per capita income has a significant positive impact on the imported food quality structure in different quality groups. The research confirms that China import more food with the highest quality as its per capita income increases.
Research limitations/implications
Chinese policymaker needs to reconsider the role of food imports in improving food quality structure. The aim of the Chinese food industry's supply-side reform should be not only to remove excess capacity but also to produce high-quality products that meet the demand of discriminating consumers.
Originality/value
This paper constructs a new theme for imported food quality structure and investigates import food quality structure improvement from the perspective of demand by incorporating non-homothetic preferences. Another feature of this paper is that it conducts an empirical analysis with unique and highly disaggregated firm import data from Chinese customs to measure imported food quality, which is more refined than the national-product dimension data.
Keywords
Acknowledgements
The authors would like to thank participants at the 2018 CAFEM Conference, the editor, and two anonymous referees for the CAER, for their useful and constructive comments and suggestions. Financial support for this research work was provided by the National Natural Science Foundation (Grant Number 71673251 and 71303216). It was also supported by the Fundamental Research Funds for the Provincial Universities of Zhejiang (Grant number: GB201902001).
Citation
Sun, L., Ye, L.T. and Reed, M.R. (2020), "
Publisher
:Emerald Publishing Limited
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