Are different income sources fungible? The effects of agricultural subsidy and disaster relief on household consumption in China

Xiaohui Peng, Li Zhao, Chengyan Yue, David Ahlstrom

Research output: Contribution to journalArticlepeer-review

1 Scopus citations

Abstract

This paper uses panel data from a sample of farm households in the northeastern China to examine the non-fungibility of different income sources. The results show the private transfer income has a high and significant impact on household consumption while agricultural subsidy and disaster relief have insignificant impacts. Empirical findings prove that the Behavioral Life Cycle Hypothesis is more practical than the Life Cycle Hypothesis. Moreover, they provide important macro policy implications as for how to stimulate farm consumption and expand domestic demand and encourage economic growth.

Original languageEnglish (US)
Pages (from-to)1153-1166
Number of pages14
JournalInternational Food and Agribusiness Management Review
Volume21
Issue number8
DOIs
StatePublished - 2018

Bibliographical note

Funding Information:
This paper is supported with the funding from Natural Science Foundation of China (Numbers 71473165, 71333010, 71773076, 71473163, and 71673186), the National Planning Office of Philosophy and Social Science (No. 14CJY082 and 15CGL008) and the Key Project of Philosophy and Social Science Research in Colleges and Universities in Jiangsu Province (No. 2017ZDIXM106). We also thank the guidance from Professor Qinghua Shi at Shanghai Jiao Tong University.

Publisher Copyright:
© 2018 Peng et al.

Keywords

  • Agricultural subsidy
  • Behavioral life cycle hypothesis
  • Disaster relief
  • Farm household consumption
  • Marginal propensity to consume

Fingerprint

Dive into the research topics of 'Are different income sources fungible? The effects of agricultural subsidy and disaster relief on household consumption in China'. Together they form a unique fingerprint.

Cite this