Impact of Agricultural Modernization, Economic Growth and Industrialization on the International Competitiveness of Agricultural Products: Based on the Empirical Analysis of Cointegration and VEC Model

The expanded agricultural trade deficit in recent years has caused widespread concern about the international competitiveness of Chinese agricultural products. In this paper, guided by Michael Porter's diamond model theory, based on agricultural production and trade data in China and the world from 1986 to 2011, we use principal component analysis, cointegration and vector error correction model, to perform an empirical analysis of the impact of agricultural modernization, economic growth and industrialization on the international competitiveness of Chinese agricultural products. The results show that China's agricultural modernization is slow, the demand for agricultural products caused by economic growth is increased, and excessive rural labor transfer due to industrialization leads to decline in the international competitiveness of Chinese agricultural products. China should increase its efforts to promote the modernization of agriculture and level of industry nurturing agriculture; use WTO rules to create a good international and domestic environment for the development of China's agriculture and improvement of the international competitiveness of agricultural products; give full play to the role of demand in boosting the industrial upgrading of domestic agriculture.