Theoretical And Empirical Studies On The Impact Of Agricultural Product Price Fluctuations On Price Index

In recent years,there is increasing inflation pressures which China's social economy is facing.also,the rate of price index is rising day by day.Meanwhile,China agricultural product price is increasing quickly.The debate on the relationship between agricultural product prices and price index has lasted a long time in academic circles.The debate can be grouped in three different views.The first aspect is that some scholars,according to theory and empirical studies concluded that the fluctuation of agricultural produts price will not lead to inceasing price index in both short term and long-term,So,the worry about inflation which is caused by agricultural prices is completely unnecessary.Secondly,according to granger causality test,Some experts and scholars considered that the fluctuation of agricultral price is the granger causality of inceasing price index.Of course,this kind of point is not very popular now,It fails to get universal recognition currently.The third point is that both influence each other,promote each other, agricultural prices will affect price index,also, price index,in turn,would also make agricultural price swings.In the above three kinds of views,the first view is more acceptable by scholars,and such views can be seen in many academic journals.It's very important for us to clear up the relationship beween between agricultural price and price index.Also,it's crucial for us to kown how agricultural price affect price index.Because,it relates to the government's economic decision-making and macroeconomic policies directly.So,I try to study how agricultural prices affect price index through theoretical and empirical analysis.This paper analyzed the research mainly from the following three aspects.Firstly,the first part of the paper stated price index theory and agricultural price fluctuations systemly,and expounds the formation mechanism of price fluctuation and agricultural mechanism in theory. Results showed that price index mainly from below reasons such as demand drive,promotion of cost,structured,monetary amount and so on.All of these are many kinds of classic inflation reasons.We considered that agricultural prices fluctuate is mainly derive from fluctuations in the price of agricultural products in international market,the production cost of conductive effect of promoting effect,farmers production of agricultural products processing demand activeness,and sudden factors pulled by disturbance effect etc.Then,Analysis results showed that agricultural prices affect inflation through two paths, on the one hand, agricultural prices directly through the statistic type influence CPI and PPI. On the other hand,the affection is indirectly.Secondly,there is mathematical statistics between agricultural prices and price index in the second part of this paper,I make chart analysis by 2002 to 2010 data.we have Found the changing rules and its effects on the economy in nearly nine years.Also,we described agricultural prices and price index in the present condition and characteristics We compared and compares the agricultural prices and inflation Analysis and research on the way and characteristics of both change.And calculation of agricultural prices and inflation,to find the relationship between them.Again,In order to prove the conclusion through theory and descriptive analysis between agricultural prices and price index,in the third part of this paper,I have made an empirical analysis between agricultural prices and price index.There are three parts in this empirical analysisThe first is the calculation on contribution of agricultural prices to price index.The second is calculation on delay of agricultural prices to price index.We draw a conclusion from this paper,the influence of agricultural prices on the CPI and PPI is 0.4076 and 0.2671 respectively.And also,the delay of agricultural prices on the CPI and PPI is 3 quarters and 4 quarters. According to the above conclusions,the delay of PPI is greater than CPI.Maybe the constitutes a consumer price index rising labor costs, the direct causes of the rise, also makes industrial production product wage costs rise. Thus cause the changes of PPI.Therefore, from the perspective of PPI, CPI also has certain effect. The third is Impulse response function analysis. according to the analysis, we can conclude that both impacts on CPI and PPI price is slow,it's hard to appeare immediately in the first phase,but,it's Gradually become large in the next phases.After the maximum it's weakened gradually until eliminate influence.Finally,we conclud the relationship between the agricultural prices and price index through Theoretical and empirical analysis.although there is no proof that the agricultural price is the reason of price index.The point that there is no relationship between agricultural prices and price index is overthrowed by the conclusion. Agricultural prices is not key factor of price index.But, judging from its impact on price index, agricultural prices also has certain contribution, and price index is always accompanied by agricultural prices increasing which means the agricultural prices can be the leading indicators of price index. According to these conclusions,we try to put forward "agricultural managing price index " this practice for China's macroeconomic policy, which can provide powerful and effective policy suggestions to prevent and control inflation.In this article,I try to use the theory which is consistent with reality,the data covered the whole China's economic and social environment, and,the appropriate method is reasonable,so that,we can concluded really reliable conclusion from this paper.Thus,it can provide us corresponding policy to sustained and healthy development for our economy.