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Essays on Product Quality, Trade Costs, and Trade Liberalization

Eum, Jihyun
http://rave.ohiolink.edu/etdc/view?acc_num=osu1500505005414076

Abstract Details

2017, Doctor of Philosophy, Ohio State University, Agricultural, Environmental and Developmental Economics.
This dissertation explores the effects of trade policies on product quality and trade flow. It is composed of three chapters: the implication of food safety standards on traded product quality improvement; the evaluation of the trade determinants using the endogenous quality choice model in food and agricultural trade; and the analysis of asymmetric trade costs and relative productivity between the developed and developing countries using Ricardian trade models. The first chapter analyzes the effect of food safety standards as well as tariffs on efforts to upgrade food product quality with quality. Compliance costs are introduced into a model of competition and innovation where the rate of food product quality upgrading is affected by both changes in tariffs and standards. Using disaggregated data for European food imports from 159 trading partners over the period 1995 to 2003 across 28 industries, the effect of standards enforcement on quality upgrading varies non-monotonically. In particular, products that already have relatively higher quality are more likely to upgrade but those having relatively lower quality are less likely to upgrade. The second chapter analyzes the determinants of bilateral food and agricultural trade using the heterogeneous-firm trade model with endogenous quality choice. Identifying the effect of trade liberalization with the consideration of product quality and firm productivity is important because productivity plays a role in determining export participation. In this chapter, an endogenous quality model provides the framework to estimate the effects of the major determinants of bilateral trade. After identifying the relationship between firm productivity and quality choice the consequences of changes in trade costs are shown. We use the Helpman, Melitz, and Rubinstein approach to show the effects of trade frictions within the context of heterogeneous productivity and product quality. The estimation results with controlling the number of exporting firms are consistent with theoretical expectations. The findings suggest that OECD members who import high-quality products restrict the number of exporting firms by applying relatively higher trade threshold than non-OECD member countries who allow export companies to enter their market easily. The third chapter examines the reason why developing countries trade fewer agricultural goods than developed countries is analyzed. Started from the argument that low trade flow in the agricultural sector is mainly due to high trade costs (Xu, 2015; Reimer and Li, 2010), our analysis investigates how bilateral trade costs in agricultural sector differ among trade partners. Asymmetric trade costs and the variability of technology in the agricultural sector are derived using Ricardian trade models. Systematically asymmetric bilateral trade costs and the variations in productivity level of all observed countries are revealed as main trade barriers for developing countries. Low-income countries face higher trade costs to export than high-income countries.
Stanley Thompson (Advisor)
Ian Sheldon (Advisor)
Sam Abdoul (Committee Member)
123 p.
Agricultural Economics; Economics

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Citations

  • Eum, J. (2017). Essays on Product Quality, Trade Costs, and Trade Liberalization [Doctoral dissertation, Ohio State University]. OhioLINK Electronic Theses and Dissertations Center. http://rave.ohiolink.edu/etdc/view?acc_num=osu1500505005414076

    APA Style (7th edition)

  • Eum, Jihyun. Essays on Product Quality, Trade Costs, and Trade Liberalization. 2017. Ohio State University, Doctoral dissertation. OhioLINK Electronic Theses and Dissertations Center, http://rave.ohiolink.edu/etdc/view?acc_num=osu1500505005414076.

    MLA Style (8th edition)

  • Eum, Jihyun. "Essays on Product Quality, Trade Costs, and Trade Liberalization." Doctoral dissertation, Ohio State University, 2017. http://rave.ohiolink.edu/etdc/view?acc_num=osu1500505005414076

    Chicago Manual of Style (17th edition)

osu1500505005414076
724
© 2017, all rights reserved.
This open access ETD is published by The Ohio State University and OhioLINK.