IDEAS home Printed from https://ideas.repec.org/a/bla/canjag/v64y2016i3p545-563.html
   My bibliography  Save this article

Country of Origin Labeling and Structural Change in U.S. Imports of Canadian Cattle and Beef

Author

Listed:
  • Edgar E. Twine
  • James Rude
  • Jim Unterschultz

Abstract

type="main"> Mandatory country of origin labeling (COOL) has become a thorny issue in U.S.–Canada bilateral trade relations. We undertake an ex post investigation of the impact of the law on U.S. imports of Canadian beef, feeder, and fed cattle. Using a partial equilibrium framework, we derive U.S. import demand equations for Canadian cattle and beef, and employ the Bai and Perron (1998, 2003) procedure for detecting multiple structural breaks with break points being endogenously determined. We find evidence that COOL may have caused significant structural change in U.S. imports of Canadian feeder and fed cattle. L’étiquetage du pays d'origine obligatoire est devenu un sujet épineux des relations commerciales entre le Canada et les États-Unis. Dans la présente étude, nous effectuons une analyse ex post des répercussions de la Loi sur les importations américaines de viande de bœuf, de bovins d'engraissement et de bovins finis. À l'aide d'un modèle d’équilibre partiel, nous avons dérivé des équations de demande d'importation de bovins et de viande de bœuf de la part des États-Unis et nous avons utilisé les tests de Bai et Perron (1998, 2003) pour déceler les ruptures structurelles multiples, dont les points de rupture ont été déterminés de façon endogène. Les résultats de notre étude montrent que l’étiquetage du pays d'origine peut avoir causé un changement structurel considérable sur les importations de bovins d'engraissement et de bovins finis.

Suggested Citation

  • Edgar E. Twine & James Rude & Jim Unterschultz, 2016. "Country of Origin Labeling and Structural Change in U.S. Imports of Canadian Cattle and Beef," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 64(3), pages 545-563, September.
    • Handle: RePEc:bla:canjag:v:64:y:2016:i:3:p:545-563
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1111/cjag.12096
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Jushan Bai & Pierre Perron, 1998. "Estimating and Testing Linear Models with Multiple Structural Changes," Econometrica, Econometric Society, vol. 66(1), pages 47-78, January.
    2. Brester, Gary W. & Marsh, John M. & Atwood, Joseph A., 2004. "Distributional Impacts of Country-of-Origin Labeling in the U.S. Meat Industry," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(2), pages 1-22, August.
    3. Jones, Keithly G. & Somwaru, Agapi & Whitaker, James B., 2009. "Country of Origin Labeling: Evaluating the Impacts on U.S. and World Markets," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 38(3), pages 1-9, December.
    4. Brester, Gary W. & Marsh, John M. & Jimmerson, Jason, 2004. "Distributional Impacts of Country-of-Origin Labeling in the U.S. Meat Industry," Briefings 29189, Montana State University, Department of Agricultural Economics and Economics, Agricultural Marketing Policy Center.
    5. D. W. K. Andrews, 2003. "End-of-Sample Instability Tests," Econometrica, Econometric Society, vol. 71(6), pages 1661-1694, November.
    6. Loureiro, Maria L. & Umberger, Wendy J., 2003. "Estimating Consumer Willingness to Pay for Country-of-Origin Labeling," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(2), pages 1-15, August.
    7. Kerr, William A., 2003. ""The Free-Traders Win The Debates But The Protectionists Win The Elections:" The Curious Case Of Mcool In The Us 2002 Farm Bill," Proceedings of the 9th Agricultural and Food Policy Systems Information Workshop, 2003: Farm Policy Development and Policy Tensions under NAFTA 16818, Farm Foundation, Agricultural and Food Policy Systems Information Workshops.
    8. MacKinnon, James G. & White, Halbert & Davidson, Russell, 1983. "Tests for model specification in the presence of alternative hypotheses : Some further results," Journal of Econometrics, Elsevier, vol. 21(1), pages 53-70, January.
    9. Lusk, Jayson L. & Anderson, John D., 2004. "Effects of Country-of-Origin Labeling on Meat Producers and Consumers," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(2), pages 1-21, August.
    10. Colin Carter & Barry Krissoff & Alix Peterson Zwane, 2006. "Can Country‐of‐Origin Labeling Succeed as a Marketing Tool for Produce? Lessons from Three Case Studies," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 54(4), pages 513-530, December.
    11. Loureiro, Maria L. & Umberger, Wendy J., 2005. "Assessing Consumer Preferences for Country-of-Origin Labeling," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 37(1), pages 49-63, April.
    12. Jushan Bai & Pierre Perron, 2003. "Computation and analysis of multiple structural change models," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 18(1), pages 1-22.
    13. Schulz, Lee L. & Schroeder, Ted C. & Ward, Clement E., 2011. "Trade-Related Policy and Canadian-U.S. Fed Cattle Transactions Basis," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 36(2), pages 1-13, August.
    14. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-1072, June.
    15. Zivot, Eric & Andrews, Donald W K, 2002. "Further Evidence on the Great Crash, the Oil-Price Shock, and the Unit-Root Hypothesis," Journal of Business & Economic Statistics, American Statistical Association, vol. 20(1), pages 25-44, January.
    16. Pouliot, Sebastien & Sumner, Daniel A., 2014. "Differential impacts of country of origin labeling: COOL econometric evidence from cattle markets," Food Policy, Elsevier, vol. 49(P1), pages 107-116.
    17. Breusch, T S, 1978. "Testing for Autocorrelation in Dynamic Linear Models," Australian Economic Papers, Wiley Blackwell, vol. 17(31), pages 334-355, December.
    18. Glynn T. Tonsor & Ted C. Schroeder & Jayson L. Lusk, 2013. "Consumer Valuation of Alternative Meat Origin Labels," Journal of Agricultural Economics, Wiley Blackwell, vol. 64(3), pages 676-692, September.
    19. Jayson L. Lusk & Jason Brown & Tyler Mark & Idlir Proseku & Rachel Thompson & Jody Welsh, 2006. "Consumer Behavior, Public Policy, and Country-of-Origin Labeling," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 28(2), pages 284-292.
    20. Loureiro, Maria L. & Umberger, Wendy J., 2007. "A choice experiment model for beef: What US consumer responses tell us about relative preferences for food safety, country-of-origin labeling and traceability," Food Policy, Elsevier, vol. 32(4), pages 496-514, August.
    21. Taylor, Mykel R. & Tonsor, Glynn T., 2013. "Revealed Demand for Country-of-Origin Labeling of Meat in the United States," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 38(2), pages 1-13, August.
    22. James Rude & Javed Iqbal & Derek Brewin, 2006. "This Little Piggy Went to Market with a Passport: The Impacts of U.S. Country of Origin Labeling on the Canadian Pork Sector," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 54(3), pages 401-420, September.
    23. Warren J Bilkey & Erik Nes, 1982. "Country-of-Origin Effects on Product Evaluations," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 13(1), pages 89-100, March.
    24. Godfrey, Leslie G, 1978. "Testing against General Autoregressive and Moving Average Error Models When the Regressors Include Lagged Dependent Variables," Econometrica, Econometric Society, vol. 46(6), pages 1293-1301, November.
    25. Thomas Vollrath & Charles Hallahan, 2006. "Testing the Integration of U.S.–Canadian Meat and Livestock Markets," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 54(1), pages 55-79, March.
    26. Umberger, Wendy J. & Feuz, Dillon M. & Calkins, Chris R. & Sitz, Bethany M., 2003. "Country-Of-Origin Labeling Of Beef Products: U.S. Consumers' Perceptions," Journal of Food Distribution Research, Food Distribution Research Society, vol. 34(3), pages 1-14, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Pudenz, Christopher C. & Schulz, Lee, 2020. "Quantifying the U.S. Market Response to the African Swine Fever Outbreak in China," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304298, Agricultural and Applied Economics Association.
    2. Fan, Jiaping & Anders, Sven & Qiu, Feng, 2022. "Vertical Price Transmission in the Canadian Beef Industry: Does the Canada-US Exchange Rate Matter?," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 23(1), June.
    3. Pudenz, Christopher C. & Schulz, Lee L., 2021. "Packer Procurement, Structural Change, and Moving Average Basis Forecasts: Lessons from the Fed Dairy Cattle Industry," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 46(3), September.
    4. Amanda M Countryman & Alessandro Bonanno, 2020. "A COOL Tale: Economic Effects of the U.S. Mandatory Country of Origin Labeling Repeal," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 42(4), pages 888-912, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pouliot, Sebastien & Sumner, Daniel A., 2014. "Differential impacts of country of origin labeling: COOL econometric evidence from cattle markets," Food Policy, Elsevier, vol. 49(P1), pages 107-116.
    2. Amanda M Countryman & Alessandro Bonanno, 2020. "A COOL Tale: Economic Effects of the U.S. Mandatory Country of Origin Labeling Repeal," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 42(4), pages 888-912, December.
    3. James Rude & Marie‐Hélène Felt & Edgar Twine, 2016. "Detecting COOL Impacts on United States–Canada Bilateral Hog and Pork Trade Flows," Agribusiness, John Wiley & Sons, Ltd., vol. 32(2), pages 272-288, April.
    4. Tyler J. Klain & Jayson L. Lusk & Glynn T. Tonsor & Ted C. Schroeder, 2014. "An experimental approach to valuing information," Agricultural Economics, International Association of Agricultural Economists, vol. 45(5), pages 635-648, September.
    5. Glynn T. Tonsor & Ted C. Schroeder & Jayson L. Lusk, 2013. "Consumer Valuation of Alternative Meat Origin Labels," Journal of Agricultural Economics, Wiley Blackwell, vol. 64(3), pages 676-692, September.
    6. Taylor, Mykel R. & Tonsor, Glynn T., 2013. "Revealed Demand for Country-of-Origin Labeling of Meat in the United States," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 38(2), pages 1-13, August.
    7. Alejandro Plastina & Konstantinos Giannakas & Daniel Pick, 2011. "Market and Welfare Effects of Mandatory Country‐of‐Origin Labeling in the U.S. Specialty Crops Sector: An Application to Fresh Market Apples," Southern Economic Journal, John Wiley & Sons, vol. 77(4), pages 1044-1069, April.
    8. Awada, Lana & Yiannaka, Amalia, 2012. "Consumer perceptions and the effects of country of origin labeling on purchasing decisions and welfare," Food Policy, Elsevier, vol. 37(1), pages 21-30.
    9. Countryman, Amanda M. & Bonanno, Alessandro & Hadrich, Joleen, 2016. "A COOL Repeal: Potential Outcomes of U.S. Mandatory Country of Origin Labeling Requirements on Dairy and Beef Sectors," Conference papers 330172, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    10. Joseph, Siny & Lavoie, Nathalie, 2008. "Effectiveness of COOL in the U.S. Seafood Industry," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6260, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    11. Joseph, Siny & Lavoie, Nathalie & Caswell, Julie A., 2014. "Implementing COOL: Comparative welfare effects of different labeling schemes," Food Policy, Elsevier, vol. 44(C), pages 14-25.
    12. Dinopoulos, Elias & Livanis, Grigorios & West, Carol, 2010. "Country of Origin Labeling (C.O.O.L.): How cool is it?," International Review of Economics & Finance, Elsevier, vol. 19(4), pages 575-589, October.
    13. Ross Hallren & Alexandra Opanasets, 2018. "Whence the Beef: The Effect of Repealing Mandatory Country of Origin Labeling (COOL) Using a Vertically Integrated Armington Model with Monte Carlo Simulation," Southern Economic Journal, John Wiley & Sons, vol. 84(3), pages 879-897, January.
    14. Bonanno, Alessandro & Countryman, Amanda & Hadrich, Joleen, 2016. "A COOL Repeal: Potential Outcomes of U.S. Mandatory Country of Origin Labeling Requirements on Dairy and Beef Sectors," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 236020, Agricultural and Applied Economics Association.
    15. Wen Chern & Huei-Ching Lin, 2012. "Taiwanese Consumer Valuation of Country of Origin Labeling Using Auction Experiment with Tasting," Journal of Family and Economic Issues, Springer, vol. 33(2), pages 184-198, June.
    16. Loureiro, Maria L. & Umberger, Wendy J., 2007. "A choice experiment model for beef: What US consumer responses tell us about relative preferences for food safety, country-of-origin labeling and traceability," Food Policy, Elsevier, vol. 32(4), pages 496-514, August.
    17. Jason M. Bienenfeld & Elizabeth R. Botkins & Brian E. Roe & Marvin T. Batte, 2016. "Country of origin labeling for complex supply chains: the case for labeling the location of different supply chain links," Agricultural Economics, International Association of Agricultural Economists, vol. 47(2), pages 205-213, March.
    18. Chern, Wen S. & Chang, Chun-Yu, 2012. "Benefit evaluation of the country of origin labeling in Taiwan: Results from an auction experiment," Food Policy, Elsevier, vol. 37(5), pages 511-519.
    19. Karen E. Lewis & Carola Grebitus & Gregory Colson & Wuyang Hu, 2017. "German and British Consumer Willingness to Pay for Beef Labeled with Food Safety Attributes," Journal of Agricultural Economics, Wiley Blackwell, vol. 68(2), pages 451-470, June.
    20. El-Shazly, Alaa, 2016. "Structural breaks and monetary dynamics: A time series analysis," Economic Modelling, Elsevier, vol. 53(C), pages 133-143.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:canjag:v:64:y:2016:i:3:p:545-563. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/caefmea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.