IDEAS home Printed from https://ideas.repec.org/a/ags/jordng/175743.html
   My bibliography  Save this article

How Much Is It Worth to Protect Sensitive Products with Tariff-Rate Quotas?―A Korean Case

Author

Listed:
  • Lim, Song-Soo
  • Babula, Ronald A.

Abstract

The tariff-rate quota (TRQ) system is a hybrid import regime that conveys both tariff- and quota-like characteristics. Established by the tariffication process during the Uruguay Round, TRQs harmonize the needs for improved market access and protection from import surges. This paper aims to identify economic and policy consequences from TRQ implementation and to test whether the trade-off between formula tariff cuts and quota expansion is adequate and thus is beneficial to the protection of declared sensitive products. Using Korea’s case of soybean imports, this paper illuminates the importance of quota administration in terms of mark-ups, economic rents and the state-trading enterprises (STEs). Application of a one-product partial equilibrium model to Korea’s soybean market suggests that it would be better for Korea to designate soybeans as a category of sensitive products. The derived quota equivalents under the option of sensitive products turn out to be smaller than otherwise. Examination of quota equivalents for formula tariff cuts indicates different proportionality or trade-offs among options. Finally, it concludes with potential areas to improve the TRQ administration under the WTO modalities.

Suggested Citation

  • Lim, Song-Soo & Babula, Ronald A., 2013. "How Much Is It Worth to Protect Sensitive Products with Tariff-Rate Quotas?―A Korean Case," Journal of Rural Development/Nongchon-Gyeongje, Korea Rural Economic Institute, vol. 35(5), January.
  • Handle: RePEc:ags:jordng:175743
    as

    Download full text from publisher

    File URL: http://purl.umn.edu/175743
    Download Restriction: no

    References listed on IDEAS

    as
    1. Philip C. Abbott & Linda M. Young, 1999. "Wheat-Importing State Trading Enterprises: Impacts on the World Wheat Market," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 47(2), pages 119-136, July.
    2. Swinbank, Alan, 2004. "Dirty Tariffication Revisited: The EU and Sugar," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 5(1).
    Full references (including those not matched with items on IDEAS)

    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:ags:jordng:175743. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: http://edirc.repec.org/data/kreinkr.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.