Demand structure transition, policy interventions and China’s grain security: A DSGE-based investigation of self-sufficiency dynamics

Confronted with the transformation of grain demand structure and the risks of short-term demand surges induced by the upgrading of residents’ dietary patterns, as well as the frequent occurrence of geopolitical conflicts and natural disasters, how to stabilize the grain self-sufficiency rate through precise policy interventions has emerged as a pivotal issue in China’s grain security governance. This study first employs the random forest approach for variable selection. On this basis, we construct a dynamic stochastic general equilibrium (DSGE) model comprising heterogeneous households (farm households and general households) and multiple production sectors (staple food, soybean, and non-grain sectors). The model systematically incorporates a total of seven categories of exogenous shocks: demand shocks for staple food and soybean, production technology shocks for the two grain types, production subsidy shocks, and agricultural machinery purchase subsidy shocks for farm households. Simulation analysis reveals that: (1) Sudden demand shocks are the primary factor driving short-term fluctuations in grain prices and affecting the real purchasing power of residents, while also eroding grain self-sufficiency rate; (2) Production technology shocks represent the fundamental force underlying the long-term evolution of grain output and self-sufficiency rate. Positive technology shocks can significantly raise the grain self-sufficiency rate and improve residents’ consumption welfare, which highlights the core role of technological progress in safeguarding national grain security. (3) Both production subsidies and agricultural machinery purchase subsidies are effective in coping with external shocks. The former delivers direct and rapid effects in stabilizing grain output and ensuring supply in the short run, whereas the latter focuses more on enhancing systemic resilience through long-term capital accumulation. The two policies are heterogeneous in terms of their mechanism and time effectiveness. This study provides a dynamic quantitative basis for optimizing the agricultural support policy system and systematically enhancing grain security capacity in a complex and volatile domestic and international environment.