Abstract
Purpose – The objective of this paper is to test whether low income countries in South-East Asian countries can import the high price and quality agri-food products of South Korea. Specifically, we divide consumers in these regions based on income level (Average, Top 10%, and Top 1% GDP per capita) to examine the exportability of those goods to South-East Asian countries. Design/Methodology/Approach – Utilizing the panel Granger causality test method of Dumitrescu and Hurlin (2012), we examine which income segments in those regions can consume the high price, quality and agri-food products of Korea. Additionally, this study also uses the panel impulse-response function to figure out the which segments are more inclined to buy agri-food products of Korea. Findings – Results of the panel Granger causality test show that the incomes of only the top 10% and 1% segments of these countries lead to agri-food imports from Korea. Results of the panel impulse response function report that the top 1% segment of income group imports more compared to the top 10% segments of the income group. Research Implications – Our results imply that high quality and high price agri-food products of Korea can be exported to low-income South and South-East Asian countries. Our approach also presents that the gravity model specification smight need to be modified according to the characteristics of products.
Published Version
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