The impact of public Expenditure on the Agricultural Sector Productivity in China.

ABSTRACT: One of the important sectors in the economy of different countries including China is Agriculture. “There was a growing awareness in growth economics that governments should closely pay attention to the agriculture sector” J.Edward (1996). Government expenditure is on the principal instruments used by the government to support the agriculture sector and its output. This study has the objective which is to look at the impact of Chinese government expenditures on the Agriculture sector output. In this empirical study, time sires data (1988-2018) was used and in the econometric analysis the ARDL Model was employed to analyze relationship between variables for the long-run and for the short-run, where the Agriculture sector output was used as a dependent target and the Expenditure (GEX), Number of state farms (NSF), Cultivated Area of state farms (CA) as independent variables. The data was collected from China’s National statistics office. The study analysis founds to have a positive relationship between the agriculture sector output and the independent variables. The government expenditure indicated a result above 0.05 in the short run and that, in the long run, indicated positive and direct relationships between the agriculture sector output and the independent variables except for the variable (NSF) which also indicated a value above 0.05. The study showed that the agriculture sector needs more government expenditure, especially in the short term, to diaper the value of the output of the agriculture sector in both short-term with long term.