Forecasting Input Demand Shocks on China’s Gross Value of Agricultural Output
Dayton M. Lambert, Seong-Hoon Cho
This paper applies recent developments in forecasting spatial process models to estimate the impact of input shocks on China’s 1999 gross value added output (GVAO) in agriculture. A Cobb-Douglas production function allowing total factor productivity to vary across regions is used to forecast the geographic distribution of GVAO following shocks in input availability. Results suggest that GVAO will be similar to baseline levels following input shocks, but the differential gains experienced in some areas may correspond with losses in neighboring administrative units.