Study On Dynamic Feedback And Policy Simulation Of Grain Price And Grain Yield

The safety for grain has always been the hot spot drawing various attentions from different countries, and it is invariably the basis of the national economic development, social stability and self-independence. China is a country with a population of 1.3 billion, as a big producer and consumer of grain, whose grain safety must, on the one hand, ensure the adequate domestic grain supply, and on the other hand, ensure the residents’basic consumption of grain. Fluctuations on grain price will affect grain production, which determines domestic comprehensive grain production capacity, affects the market supply and eventually sets the grain price. As the most fundamental and significant variety of agricultural products and raw materials for other industries’ production, the changing trend of grain involves various aspects of profits of macro-economy and directly relates to different means of production in the process of agricultural production. The change of agricultural means of production influences production cost and the alteration of production cost also has a lot of influences on grain production, and then affects the comprehensive production capacity and market supply. Obviously, these effects, in turn, will have an impact on grain prices. Therefore, there are transmission as well as feedbacks in the interactions between grain prices and production.Based on the analysis of formation mechanism of grain price and its fluctuant features, this thesis reveals the main factors of grain price volatility and its influence path. On the basis of analyzing the affecting factors of changes in unit area grain yield, the thesis clarifies the influence of price on grain production and supply, then builds up a kinetic model with dynamic feedback system of grain prices and production, adopting the market price, planting area and grain reserves as the main level variables, and tests the scientificness and rationality of this model by using historical data. Consequently, the scenario simulation can be conducted by means of the system model which presupposes fifteen policy improving schemes. The thesis next compares the simulation results to evaluate grain security level, to explore the best policy improvement projects, to enrich the study on grain price, grain production or policy simulation, and also to provides references for government to formulate adjustment measures of grain and make decision on the grain market reform.The thesis consists of four parts. Part One including Chapter One, Chapter Two and Chapter Three, mainly elaborates the background, significance and targets of the research, introduces the main content, research methods, technical route, characteristics and innovation of this paper, relevant literature review, concept definition as well as the theoretical basis. Part Two involving Chapter Four and Chapter Five, by methods of pathway analysis, analyzes the factors affecting grain price obviously, divides grain yield into unit area yield and sowing area, makes empirical analysis on the influencing factors of the unit area yield by using CD production function respectively, and also analyzes the affecting factors of sowing area and supply response that sowing area gives to price. Part Three contains Chapter Six and Chapter Seven. On the basis of the above analysis of grain price, grain yield and their influencing factors, this part constructs a dynamic feedback simulation model of grain price and grain yield through the gradually thorough simulation technology, the rationality and feasibility of which is also be tested. This part further makes use of the simulation results of the system model simulation policy improvement schemes to evaluate the grain security level after policy improvement and to screen out optimal schemes. Part Four includes Chapter Eight, which summarizes the above research conclusion and puts forward some suggestions to further improve the level of China’s grain security. Through the analysis, the main research conclusions are drawn as follows:(1) By using pathway analysis to exemplify the factors affecting the grain price, the result shows that production cost is the key factors which finally influence the grain price. The exorbitant production cost not only brings heavier burden to farmers, affects the level of farmers’income, but also dampens their enthusiasm on grain plant. With the increase of population, people’s increasing grain ration demand will have an impact on the grain price as well. Although financial factors such as money supply and factors of the national market are also significant effects on grain price, the increase in money supply will only play an important role in promoting grain price in the long run, and such effects may be counteracted by the government’s macroscopic adjusting policies, protective price policy, cost variation and some other factors.(2) Unit area yield production function model is constructed utilizing the CD production function which indicates that the available labor input of fixed effects estimation scheme, gross power of agricultural machinery, fertilizer input have appreciable impacts on the unit area yield of grain. To understand the price influence on grain supply, the thesis builds up a Nerlove model, and the empirical result shows that rigidity of the sowing area contributes to that early sowing area remarkably influences the current sowing area. Fluctuations of the production cost will also, through farmers’ expectation, compare the behaviors among revenues’ effects on the current production decision-making, changes of planting decisions and adjustment of factors input, and in the end, influence sowing area.(3) The result of policy scenario simulation conducted by the dynamic feedback system model of grain price and yield shows that when many policies are improved and have effects on the system, the result of the system simulation will reach the most ideal state. However, the cost of the policy implementation and the uncertainty of the policy effect cannot be ignored when enacting policy improvement schemes. After comparing with other simulation results of policy combination, it can be found that through the combination of policy scheme, such as the increasing influence of policies on financial currency subsidy or the effects of grain direct subsidy policy and the increase of the minimum purchase price policy for grain, a higher level of security can also be achieved.