The Mechanism And Empirical Study Of The Impact Of RMB Exchange Rate On The Quality Of Imported Food In China

Since 2006,the quality of imported food in China has improved significantly,which has dispelled China's doubts about the substantial increase in total food imports during this period.But it has also become a new phenomenon that needs to be explained.With the implementation of the RMB exchange rate policy reform,the RMB has entered a stage of rapid appreciation since 2006.Does the appreciation of the RMB promote the quality of imported food in China? Starting from the demand dimension,this paper builds a theoretical model of exchange rate changes and imported product quality based on the Feenstra & Romalis(2014)model,and uses the Chinese customs micro-enterprise import data from 2001 to 2013 to measure the quality of Chinese imports by KSW(2013).On the basis of the data,the paper empirically analyzes the impact of the appreciation of the RMB exchange rate on the quality of Chinese imported food.The study found that:(1)RMB appreciation will help improve the quality of imported food in China;(2)As the per capita income of importing countries increases,the impact of exchange rate appreciation on the quality of imported foods will gradually decrease,compared with that in high-income areas.The appreciation of the RMB has a greater effect on the quality of imported foods consumed by low-income groups;(3)In addition,there are differences in the impact of RMB exchange rate changes on importing countries with different income levels and products with different quality.When the country is a high-income country,the appreciation of exchange rate has a more significant effect on the quality of imported food.Meanwhile,in the products with more differentiated quality,the appreciation of exchange rate will increase the quality of imported products.The results of therobustness test indicate that the significant positive impact of the appreciation of the RMB on the quality of imported food in China will not change due to differences in whether foods contain bulk commodities,exchange rate indicators,and quality measurement methods.At the same time,based on the difference-in-difference model,the policy effect of the reform of RMB exchange rate policy on the quality of imported food in China was evaluated empirically.The empirical results show that the implementation of this policy can significantly improve the quality of imported food in China.The results of this paper provide a better theoretical basis and guidance for the government to effectively and comprehensively formulate policies related to the food industry.