SABIIA - Sistema Aberto e Integrado de Informação em Agricultura (Sabiia)

Kim, Mina; Cho, Guedae; Koo, Won W..

Using a dynamic gravity equation, we show that the national product differentiation model explains food and agricultural trade, while the product differentiation model explains large-scale manufacturing trade for both short- and long-run. We provide reasons of discrepancy from Head and Ries (2001) in the short-run, and illustrate the positive impacts of world income growth on bilateral trades.

ASYMMETRIC PATTERN OF INTRA-INDUSTRY TRADE BETWEEN THE UNITED STATES AND CANADA

Palavras-chave: International Relations/Trade.

Ano: 2004

URL: http://purl.umn.edu/20248

This study proposes alternative rationales to explain an asymmetric intra-industry trade pattern between the United States and Canada after the free trade agreement became effective. Using time-series data, a gravity equation is developed which enables us to examine the impacts of relative market size, exchange rates, and transportation costs on bilateral trade. It is found that these three effects have to be taken together in order to explain the asymmetric intra-industry trade pattern. Exchange rate impacts on bilateral trade are found to the most significant, indicating that U.S. dollar appreciation causes a more asymmetric trade pattern for agricultural goods than for large-scale manufacturing goods.

Third-Country Effects on the Market Shares of U.S. Wheat in Asian Countries

Palavras-chave: Border effects; Exchange rates; Gravity equation; Intra-industry trade; National product differentiation model; Product differentiation model; International Relations/Trade.

Ano: 2003

URL: http://purl.umn.edu/23625

EXCHANGE RATE MISALIGNMENT AND AGRICULTURAL TRADE

Jin, Hyun Joung; Cho, Guedae; Koo, Won W..

An import demand model, augmented with third-country effect variables, is developed to examine the effects of strong U.S. dollar, volatility of the U.S. dollar, and competition among the exporting countries on the shares of U.S. wheat in Asian markets. In the empirical model, the dependent variable is the market shares of U.S. wheat. Explanatory variables include wheat prices of exporting countries, exchange rates between the importing and exporting countries, and volatilities of the exchange rates. Panel estimation results show that the U.S. currency values and volatility, Australian wheat price, and the volatilities of Canadian and Australian currency values have significant effects on U.S. market shares.

Tipo: Journal Article

Palavras-chave: Exchange rate; International grain trade; Market share; Panel analysis; Panel unit-root test; Third country effect; F14; Q17.

Ano: 2004

URL: http://purl.umn.edu/43478

Cho, Guedae; Sheldon, Ian M.; McCorriston, Steve.

Using a sample consisting of bilateral trade flows across 10 developed countries between 1974 and 1995, this paper explores the effect of exchange rate misalignment on the growth of agricultural trade as compared to other sectors. Controlling for other factors likely to determine the growth in bilateral agricultural trade, the results show that long-run real exchange rate variability has had a significant negative effect on the growth of agricultural trade over this period. Keywords: Exchange rates, misalignment, agricultural trade

DETERMINING BILATERAL TRADE PATTERNS USING A DYNAMIC GRAVITY EQUATION

Palavras-chave: Exchange rates; Misalignment; Agricultural trade; International Relations/Trade.

Ano: 2000

URL: http://purl.umn.edu/21824

Using a dynamic gravity equation, we show that the national product differentiation model explains food and agricultural trade more properly, while the product differentiation model is more appropriate to explain large-scale manufacturing trade. In this context, our result is not consistent with the one found by Head and Ries (2001) in the short-run. The intuitive explanation for this result is that inward foreign direct investment can occur through either merger or acquisition in the short-run. Second, the pattern of bilateral trade could quickly adjust to changes in relative income between countries. Furthermore, we illustrate the positive impacts of world income growth on bilateral trade, which is in sharp contrast with the conventional analysis....

NOMINAL EXCHANGE RATE MISALIGNMENT: IS IT PARTICULARLY IMPORTANT TO AGRICULTURAL TRADE?

Palavras-chave: Dynamic gravity equation; National product differentiation; Product differentiation; World income growth; International Relations/Trade.

Ano: 2003

URL: http://purl.umn.edu/23538

Cho, Guedae; Kim, MinKyoung; Sun, Edwin; Jin, Hyun Joung; Koo, Won W..

This paper examines whether exchange rate misalignment negatively affects agricultural trade, compared to other industry sectors. Nominal exchange rate misalignment is obtained from the percentage deviation of real exchange rates from their long-run equilibrium based on the theory of purchasing power parity. In order to explore this issue, a bilateral trade matrix involving trade flows between 10 developed countries is constructed. Using panel data analysis, a gravity model is estimated for 4 industry sectors over the period 1974-1999. The study finds that over-valuation (under-valuation) of the nominal exchange rate negatively (positively) affects export performance of the agricultural sector in particular. In the large-scale manufacturing sectors...

RELATIVE AGRICULTURAL PRICE CHANGES IN DIFFERENT TIME HORIZONS

Palavras-chave: Exchange rate misalignment; Agricultural trade; Gravity model; International Relations/Trade.

Ano: 2003

URL: http://purl.umn.edu/23569

Cho, Guedae; Kim, MinKyoung; Koo, Won W..

Using a monthly data covering from 1974:1 to 2002:12, this paper explores the linkage between changes in macroeconomic variables (real exchange rate and inflation rate) and changes in relative agricultural prices in different time horizons (1, 12, 24, 36, 48, and 60 months). Controlling for factors likely to determine the long run trend of relative agricultural prices, the results show that long-term changes in real exchange rate has had a significant negative correlation with the long-term changes in relative agricultural prices. Conversely, changes of the general price have a role in explaining short-term changes in relative agricultural price at best.

THE TRADE IMBALANCE BETWEEN THE UNITED STATES AND CHINA: THE ROLE OF EXCHANGE RATE AND TRADE LIBERALIZATION

Palavras-chave: Demand and Price Analysis.

Ano: 2003

URL: http://purl.umn.edu/22249

Cho, Guedae; Koo, Won W..

The pattern of trade between the United States and China has dramatically changed during the past 15 years. Until 1992, the commodity trade volume between the two countries was around $10 billion per year, but it grew to $60 billion in 1999. Because China has kept its currency (yuan or renminbi) pegged to the U.S. dollar since 1994, its current large trade surplus with the United States has led some critics to claim that the yuan is undervalued. The aim of this paper is to examine the effect of the U.S.-China bilateral exchange rate on the pattern of trade between the two countries after controlling for alternative factors influencing U.S.-Chinese bilateral trade flows. The results suggested that the U.S-China bilateral exchange rate does not have an...

DOES EXCHANGE RATE MATTER TO AGRICULTURAL BILATERAL TRADE BETWEEN THE UNITED STATES AND CANAD?

Palavras-chave: International Relations/Trade.

Ano: 2004

URL: http://purl.umn.edu/23553

Cho, Guedae; Kim, Mina; Koo, Won W..

This study examines the effects of the U.S.-Canada exchange rate on bilateral trade of agricultural goods between the two countries and on U.S. farm income. Special attention is given to agricultural trade between the two countries under the Canada - United States Free Trade Agreement (CUSTA). This study utilizes two time series models: the vector error correction model (VECM) and the vector moving average model (VMA) with quarterly time series data from 1983 to 2000. This study found that exchange rates have a significant impact on U.S. agricultural trade with Canada and that the exchange rate between the two currencies is weakly exogenous in the U.S. agricultural sector, indicating that it is not influenced by U.S. agricultural trade with Canada and...

THE RELATIVE IMPACT OF NATIONAL MONETARY POLICIES AND INTERNATIONAL EXCHANGE RATE ON LONG-TERM VARIATIONS IN RELATIVE AGRICULTURAL POLICIES

Palavras-chave: Cointegration; VECM; VMA; Exchange rate impacts; Weak exogeneity; Over-identification; Short- and long-run impulse response; International Relations/Trade.

Ano: 2002

URL: http://purl.umn.edu/23485

Cho, Guedae; Kim, MinKyoung; Koo, Won W..

This paper seeks to explain the causes of the long-term variation in food and agricultural prices compared to the overall price level in the United States, over the period of 1974-1996. Using cointegration methods, this study confirms a general consensus of long-run neutrality of national money (money supply) and gives practical evidence of the real impact of international money (exchange rate) on the long-term variation of relative agricultural price in the United States, especially during the 1974-1988 period.

THE EFFECT OF EXCHANGE RATE VOLATILITY ON WHEAT TRADE WORLDWIDE

Palavras-chave: Long-term variation of agricultural prices; Exchange rates; Money supply; Agricultural and Food Policy; Financial Economics.

Ano: 2004

URL: http://purl.umn.edu/23495

Sun, Changyou; Kim, Mina; Koo, Won W.; Cho, Guedae; Jin, Hyun Joung.

A modified gravity-type model was employed to evaluate the effect of exchange rate volatility on wheat exports worldwide. Special attention was given to the econometric properties of the gravity model within panel framework. Short and long-term measures of exchange rate volatility were constructed and compared. Both measures of exchange rate volatility have exhibited a negative effect on world wheat trade and the long-term effect was even larger. This result implies that exchange rate volatility is an important factor in explaining the trade pattern of wheat trade worldwide. Keywords: wheat, export, exchange rate, volatility, gravity model, and panel data.

EFFECTS OF THE CANADIAN WHEAT BOARD ON THE U.S. WHEAT INDUSTRY

Palavras-chave: Wheat; Export; Exchange rate; Volatility; Gravity model; And panel data.; International Relations/Trade.

Ano: 2002

URL: http://purl.umn.edu/19766

Koo, Won W.; Jin, Hyun Joung; Mattson, Jeremy W.; Taylor, Richard D.; Cho, Guedae.

The practices of the Canadian Wheat Board (CWB) are an important issue in U.S. - Canada trade disputes and WTO negotiations. This study analyzes the CWB?s effect on U.S. producers by reviewing findings from previous research and developing models to analyze CWB wheat exports to the United States and the competitive structure of Canadian wheat exports in the world market. U.S. grain producers could benefit from the removal of the CWB as the United States could become more competitive in export markets. However, elimination of the CWB could also result in an increase in Canadian wheat exports to the United States as Canadian producers near the border could sell directly to the United States to take advantage of market opportunities. The net effect is...

THIRD COUNTRY EFFECTS ON U.S. WHEAT EXPORT PERFORMANCE IN ASIAN COUNTRIES

Palavras-chave: Canadian Wheat Board; State trading enterprises; Price discrimination; Wheat exports; Crop Production/Industries; International Relations/Trade.

Ano: 2004

URL: http://purl.umn.edu/23530

Jin, Hyun Joung; Cho, Guedae; Koo, Won W..

This study examines third country effects on U.S. wheat export performance in Asian countries. An import demand model is developed to analyze the impacts of price competitiveness, exchange rates, and exchange rate volatilities on U.S. wheat market shares. The United States competes with Australia and Canada in the Asian wheat market. Empirical results show that two factors, Australian wheat price and U.S. dollar values against the Asian countries' currencies, have significant effects on U.S. market shares in this region. Furthermore, exchange rate risks between the exporting and importing countries are found to be important.

EXCHANGE RATE PASS-THROUGH AND ITS RELATION TO MARKET POWER: REINTERPRETATION OF THE DEGREE OF EXCHANGE RATE PASS-THROUGH

Palavras-chave: International grain trade; Market share; Exchange rate; Panel analysis.; International Relations/Trade.

Ano: 2003

URL: http://purl.umn.edu/23529

We propose a different perspective for interpretation of exchange rate pass-through: a relatively lower (higher) degree of pass-through implies a competitive (less competitive) market. Using three different wheat exporting countries, the United States, Canada, and Australia, and two importing countries, Japan and Korea, we are not likely to reject our hypothesis. In the competitive market (Japan), the exporting countries determine their prices based on changes in the competing country's price, and as a result, there is a close-to-zero degree of exchange rate pass-through. However, a lower degree of price competition and a significantly higher degree of exchange rate pass-through are found in a less competitive market (Korea).

THE EFFECT OF EXCHANGE RATE VOLATILITY ON WHEAT TRADE WORLDWIDE

Palavras-chave: Agribusiness.

Ano: 2003

URL: http://purl.umn.edu/21908

Sun, Changyou; Kim, Mina; Koo, Won W.; Cho, Guedae; Jin, Hyun Joung.

A modified gravity-type model was employed to evaluate the effect of exchange rate volatility on wheat exports worldwide. Special attention was given to the econometric properties of the gravity model within a panel framework. Short and long-term measures of exchange rate volatility were constructed and compared. Both measures of exchange rate volatility exhibited negative effects on world wheat trade, with even greater effects in the long-term measure. This result implies that exchange rate volatility is an important factor in explaining the trade pattern of wheat worldwide.

THE CAUSES OF INTRA-INDUSTRY TRADE BETWEEN THE U.S. AND CANADA:TIME-SERIES APPROACH WITH A GRAVITY MODEL

Palavras-chave: Wheat; Export; Exchange rate; Volatility; Gravity model; And panel data.; International Relations/Trade.

Ano: 2002

URL: http://purl.umn.edu/23579

This study proposes alternative reasons to explain an asymmetric intra-industry trade for agricultural products between Canada and the United States after the free trade agreement became effective. Using time-series data, a gravity model is developed which enables us to examine the significance of exchange rates and different trade patterns on bilateral trade.

Macro Effects on Agricultural Prices in Different Time Horizons

Palavras-chave: International Relations/Trade.

Ano: 2003

URL: http://purl.umn.edu/21943

Koo, Won W.; Cho, Guedae; Kim, MinKyoung.

Using monthly data covering 1974:1 to 2002:12, this paper explores the linkage between changes in macroeconomic variables (real exchange rate and inflation rate) and changes in relative agricultural prices in different time horizons (1, 12, 24, 36, 48, and 60 months). By controlling factors that determine the long-run trend of relative agricultural prices, the results show that long-term changes in real exchange rates have had a significant negative correlation with the long-term changes in relative agricultural prices. Conversely, changes in the general price significantly affect short-term changes in the relative agricultural price.

MEASURING THE MARKET POWER OF THE U.S. WHEAT EXPORTERS IN ASIAN COUNTRIES: AN ISSUE ABOUT ADJUSTMENT OF NOMINAL EXCHANGE RATE WHEN USING AS A COST SHIFTER; THE COMPETITIVENESS OF THE U.S. WHEAT EXPORTERS IN ASIAN COUNTRIES

Palavras-chave: Relative agricultural price; Exchange rates; Inflation rates; Unit root test; Canonical cointegration regression; Money neutrality; Demand and Price Analysis.

Ano: 2005

URL: http://purl.umn.edu/19349

Cho, Guedae; Jin, Hyun Joung; Koo, Won W..

The objective of this article is to measure the market power of U.S. grain exporters in the Asian countries. This study revisits the issue of the market power with the Goldberg and Knetter (1999) model, addressing an issue about using nominal exchange rate as a cost shifter. This study proposes an adjusted nominal exchange rate deflated by inflation rates of exporting countries and exchange rate risk as another possible risk shifter. The results of the preliminary estimation show that using the adjusted exchange rate provides better results. The results also show that U.S. wheat exporters have market power in Philippine, Korea, Malaysia, and Singapore, while no market power in Indonesia and Japan. Australia plays a significant role in constraining the...