A Study On The Impact Of Economic Policy Uncertainty On Agricultural Products Prices

With the complex and changeable international political and economic environment,the continued advancing domestic market-oriented reform,the uncertain factors in the market economy environment of our country will inevitably bring serious impact to the agricultural product market.In terms of theory analysis,this paper use the "Economic Policy Uncertainty Index" to measure the uncertainty in the macroeconomic environment.And it combines "Aggregate Supply-Aggregate Demand Theory" with "Real Option Theory","Precautionary Saving Theory" and "Binary Marginal Theory of Export".This paper analyzes the relationship and transmission path between "Economic Policy Uncertainty" and "Price of Agricultural Products".In terms of empirical analysis,the FAVAR model is used with the uncertainty of economic policy as the observable potential driving force that affects the prices of agricultural products.The impact effects of domestic economic policy uncertainty and international economic policy uncertainty on the prices of Chinese food crops,oil crops,livestock and poultry products,cotton sugar and other agricultural products from January 2006 to September 2017 were identified,measured and compared.The cost factor,international trade factor,monetary policy factor,financial factor and consumption factor are used as the source factors of uncertainty factors.The contribution of these uncertainty factors to the price shock of bulk agricultural products in China is analyzed.The results show that the price response of main agricultural products to the uncertain impact of economic policy has the characteristics of real time,periodicity and negative.Besides,its response to the uncertain impact of domestic economic policy is more rapid and intense.The response to the uncertain impact of international economic policy is more flexible;the response range and cycle of various agricultural products prices are obviously different;among the mentioned uncertainty factors,the financialization factor has the greatest contribution to the price shock of staple food crops.The contribution of monetary policy factors to the price shock of bulk livestock products is the largest,and the consumption factor to the bulk oil crops and bulk cotton and sugar price shocks is the largest contribution.This means that at a time when global trade becoming more and more open,and in the face of a variety of uncertainties in domestic and international markets,maintaining a stable and efficient economic policy environment should be an important objective for policy makers.It is essential to mitigate or weaken the fluctuation of agricultural products prices through corresponding measures like establishing and applying the comprehensive and accurate agricultural product market information monitoring system,reducing uncertain impact through the different kinds of uncertain shock sources.In addition,it is necessary to coordinate domestic and foreign market resources,taking the current and future development into consideration,give play to the role of the government as a baton, and make rational use of the regulatory function of the market.It will help to stabilize the uncertain impact scientifically and maintain the sustainable and stable operation of agricultural product prices.