IDEAS home Printed from https://ideas.repec.org/p/mtu/wpaper/12_08.html

Price, Quality, and International Agricultural Trade

Author

Listed:
  • Darian Woods

    (The Treasury)

  • Andrew Coleman

    (Motu Economic and Public Policy Research and the Treasury)

Abstract

The average value of a particular class of agricultural exports varies widely across different destinations. This raises the question: in the event of a supply shock, such as the implementation of the Emissions Trading Scheme, can farmers offset higher costs by raising their average prices by contracting exports to lower value destinations? If the difference in value reflects different prices because producers have market power, the answer will be "yes". If the difference in value reflects differences in the quality of goods exported to different destinations, the answer is "no". This paper use a variety of trade data and techniques to examine which explanation is most likely to be relevant. While the answers are not definitive, there is little support for the hypothesis that exports are curtailed.

Suggested Citation

  • Darian Woods & Andrew Coleman, 2012. "Price, Quality, and International Agricultural Trade," Motu Working Papers 12_08, Motu Economic and Public Policy Research.
    • Handle: RePEc:mtu:wpaper:12_08
    as

    Download full text from publisher

    File URL: https://motu-www.motu.org.nz/wpapers/12_08.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Dean, Judith M., 1992. "Trade and the environment : a survey of the literature," Policy Research Working Paper Series 966, The World Bank.
    2. Aiginger, Karl, 1997. "The Use of Unit Values to Discriminate between Price and Quality Competition," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 21(5), pages 571-592, September.
    3. Hallak, Juan Carlos, 2006. "Product quality and the direction of trade," Journal of International Economics, Elsevier, vol. 68(1), pages 238-265, January.
    4. Robert C. Feenstra & Robert E. Lipsey & Haiyan Deng & Alyson C. Ma & Hengyong Mo, 2005. "World Trade Flows: 1962-2000," NBER Working Papers 11040, National Bureau of Economic Research, Inc.
    5. Richard Fabling & Arthur Grimes & Lynda Sanderson, 2012. "Whatever next? Export market choices of New Zealand firms," Papers in Regional Science, Wiley Blackwell, vol. 91(1), pages 137-159, March.
    6. Juan Carlos Hallak & Peter K. Schott, 2011. "Estimating Cross-Country Differences in Product Quality," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 126(1), pages 417-474.
    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. Levente Timar, 2016. "Does money grow on trees? Mitigation under climate policy in a heterogeneous sheep-beef sector," Motu Working Papers 16_09, Motu Economic and Public Policy Research.
    2. Allan, Corey & Kerr, Suzi, 2013. "Examining Patterns in and Drivers of Rural Land Values," 2013 Conference, August 28-30, 2013, Christchurch, New Zealand 160191, New Zealand Agricultural and Resource Economics Society.
    3. Grimes, Arthur & Hyland, Sean, 2012. "Passing the Buck: Impacts of Commodity Price Shocks on Rural Outcomes," 2012 Conference, August 31, 2012, Nelson, New Zealand 136046, New Zealand Agricultural and Resource Economics Society.

    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. Eleonora Cavallaro & Piero Esposito & Alessia Matano & Marcella Mulino, 2013. "Technological Catching Up, Quality of Exports, and Competitiveness: A Sectoral Perspective," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 49(6), pages 4-21, November.
    2. Esteban Jaimovich & Vincenzo Merella, 2012. "Quality Ladders In A Ricardian Model Of Trade With Nonhomothetic Preferences," Journal of the European Economic Association, European Economic Association, vol. 10(4), pages 908-937, August.
    3. Andrey A. Gnidchenko, 2018. "Measuring product-level export quality: Evidence from Asian motor vehicles sector," FIW Working Paper series 185, FIW.
    4. Curzi, Daniele & Pacca, Lucia, 2015. "Price, quality and trade costs in the food sector," Food Policy, Elsevier, vol. 55(C), pages 147-158.
    5. Daniele Curzi & Lucia Pacca & Alessandro Olper, 2013. "Estimating Food Quality from Trade Data: An Empirical Assessment," LICOS Discussion Papers 33913, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
    6. Juan Carlos Hallak & Peter K. Schott, 2011. "Estimating Cross-Country Differences in Product Quality," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 126(1), pages 417-474.
    7. Iheb FRIJA, 2008. "La compétitivité de l'industrie d'habillement tunisienne. Atouts et limites (The tunisian clothing industry competitiveness : assets and limits)," Working Papers 200, Laboratoire de Recherche sur l'Industrie et l'Innovation. ULCO / Research Unit on Industry and Innovation.
    8. Štefan Bojnec & Imre Fertő, 2017. "Quality Upgrades of EU Agri-Food Exports," Journal of Agricultural Economics, Wiley Blackwell, vol. 68(1), pages 269-279, February.
    9. Wei-Chih Chen, 2013. "The Extensive and Intensive Margins of Exports: The Role of Innovation," The World Economy, Wiley Blackwell, vol. 36(5), pages 607-635, May.
    10. Cassagnard Patrice & Thiam Mamadou, 2024. "How does consumer quality misperception change European Union antidumping actions?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 160(4), pages 1247-1275, November.
    11. Lisandra Flach & Eckhard Janeba, 2017. "Income inequality and export prices across countries," Canadian Journal of Economics, Canadian Economics Association, vol. 50(1), pages 162-200, February.
    12. Ferto, Imre & Bojnec, Stefan, 2015. "Quality upgrading in the European-Union agri-food exports," 89th Annual Conference, April 13-15, 2015, Warwick University, Coventry, UK 204225, Agricultural Economics Society.
    13. Andrey A. Gnidchenko, 2019. "The Conflicting Ways to Dissect Intra-Industry Trade," FIW Working Paper series 193, FIW.
    14. Flach, Lisandra, 2016. "Quality upgrading and price heterogeneity: Evidence from Brazilian exporters," Journal of International Economics, Elsevier, vol. 102(C), pages 282-290.
    15. Angela Cheptea & Charlotte Emlinger & Lionel Fontagné & Gianluca Orefice & Olga Pindyuk, 2014. "The Development of EU and EU Member States' External Competitiveness," Working Papers 2014-06, CEPII research center.
    16. Kichko, Sergey & Kokovin, Sergey & Zhelobodko, Evgeny, 2014. "Trade patterns and export pricing under non-CES preferences," Journal of International Economics, Elsevier, vol. 94(1), pages 129-142.
    17. Pablo D. Fajgelbaum & Amit K. Khandelwal, 2016. "Measuring the Unequal Gains from Trade," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 131(3), pages 1113-1180.
    18. Picard, Pierre M. & Okubo, Toshihiro, 2012. "Firms' locations under demand heterogeneity," Regional Science and Urban Economics, Elsevier, vol. 42(6), pages 961-974.
    19. Chu Ping Lo, 2018. "China's New Silk Road and China-EU Trade," Annals of Economics and Finance, Society for AEF, vol. 19(2), pages 683-701, November.
    20. Andrew B. Bernard & J. Bradford Jensen & Stephen J. Redding & Peter K. Schott, 2007. "Firms in International Trade," Journal of Economic Perspectives, American Economic Association, vol. 21(3), pages 105-130, Summer.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F18 - International Economics - - Trade - - - Trade and Environment
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:mtu:wpaper:12_08. 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: Emma Williams (email available below). General contact details of provider: https://edirc.repec.org/data/motuenz.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.