Modelling The Impact Of Economic Policy Change On Industrialization

Based on the experiences of scholars at home and abroad studying at industrialization, and according to the general equilibrium theory, this paper applies computable general equilibrium technology to simulate the impact of economic policy change on industrialization. Besides, based on comparing a lot of CGE model, this paper introduces India Storm Model. Because of the diffe~nt condition and statistical data of countries, this paper improved India Storm Model and estimated the parameter of Model by using linear regression based on China's statistical data. Moreover, In order to make up for the defect of India Storm Model, we have to deduce a labor Model from Douglas production function by making use of New-Austria Production Model, and then set up China Agricultural Industrialization Model. At last, this paper designs six scenarios to simulate the impact of such economic policy as farm product price, fertilize price, production subsidy and non-agricultural wage change on industrialization0 And then we can reaches the conclusions: We think that, as far as farm product price and fertilizer price is concerned, government should control the price. And thus the increase of farm product output can be ensured. Secondly, viewed as a whole, subsidy of agricultural production should be kept. But we should consider regional difference. That is, the subsidy of agricultural production to the developed region should be reduced, and the subsidy of agricultural production to the developing region should be increased. At last, the increase of non-agricultural industries?wage will stimulate the growth of economy. Therefore, we think that, the increase of non-agricultural industries?wage is a positive policy.