Three Essays on the Impacts of Taiwan’s Agricultural Policy from the Aspects of Agricultural Output Values, Revenues and Farmland Use

In recent decades, the agricultural sector in Taiwan has confronted increased pressure not only from the rapid economic development and the liberalization of global trade system, but also from the concerning over farmland conservation and the challenge of arable land loss. In response to these potential drivers of adverse agricultural economic trends, the government has taken heed of the preoccupation and tries to enact policies to assist the development of domestic agriculture, accelerate structural adjustments to the farming sector, support and maintain farmers’ income and conserve the resource of agricultural land. However, despite political commitments to these policies, there is currently little ex post empirical evidence regarding the actual economic influences and effectiveness of these policies. In essence, after the accession to the World Trade Organization (WTO) since 2002, Taiwan has vigorously contacted its trade partners to seek possible form of the economic closer partnership, such as the Free Trade Agreements (FTAs), the Trans-Pacific Strategic Economic Partnership Agreement (TPP) and Regional Comprehensive Economic Partnership (RCEP). It is expected that the expanded market access will bring more impacts on the agriculture in Taiwan. As a result, we try to contribute some insights and further policy implications in the agricultural perspectives. In the first two essays, we adopted the recently developed panel data approach for policy evaluation to construct the annual agricultural growth path of Taiwan, which is mainly based on the cross-sectional correlations between the domestic and international agricultural trade markets in the absence of Taiwan’s entry into the WTO. Our results have not only revealed the importance of ex post counterfactual analysis, but also provided empirical evidence for the agricultural economic shocks. Furthermore, in the third essay, this paper adds to current knowledge by assessing the effect of different kinds of agricultural zoning based on the Regional Plan Act which was enacted in 1974 and amended in 2000 in Taiwan and using big data in combination with datasets from a management information system (MIS) and geographic information system (GIS). With the software of GIS and the structural query language (SQL), we extracted analytic data from map profiles along with data from a social economic dataset. We applied a random effects panel regression model as an illustration to test the impacts of zoning and other social factors on farmland at a village level, for example, the population density and dependency ratio of the elderly population. From the policy perspective, our results demonstrate that the current design and pattern of agricultural zoning may not achieve the policy targets to preserve farmland.