Export Supply Functions Research Articles

디지털농업 결정요인이 우리나라 농식품수출에 미치는 영향분석

As the instability of the global economy continues after Covid-19, international trade is finding a new turning point. In particular, through the development of information and communication technology, all industries are attempting digital transformation and establishing a new economic system. Recently, the agricultural sector is facing the challenge of strengthening export competitiveness beyond food security in each country. Amid these changes, the emergence of digital agriculture has emerged as an alternative to creating new opportunities in the global market through agriculture.
 This study analyzed the impact of determinants for domestic digital agriculture transition on agricultural exports and presented implications. The analysis model was set as the export supply function, and the actual economic growth rate, including the relative price of export products, and the public R&D intensity, including public R&D expenses, and the number of professional researchers were selected as determinants for the digital transformation of the agricultural sector. Looking at the analysis results, the export relative price index generally used in the export supply function was analyzed to have a positive (+) effect, but the real economic growth rate, a substitute variable for domestic demand pressure, did not show statistically significant results. In addition, among the determinants of digital agriculture, R&D costs and intensity were analyzed to have a positive effect on agricultural exports, but the number of professionals did not produce statistically significant results. Summarizing the analysis results, it is understood that the expansion of R&D and investment for digital agriculture has a direct impact on agricultural exports, and the need for active investment and development in creating a digital agricultural foundation in the domestic agricultural sector in the future.

Export Function Estimates for the Pakistan Carpet Industry

This paper explores the behaviour of exports of ‘exotic’ carpets/rugs from Pakistan over the period from 1970-2003. These rugs are sold purely for decorative purposes mainly to the major Western economies. This sector of world trade has been neglected by economists as there is only one study of Iranian carpet trade [Karimi (2003)] which has so far only been presented as a short abstract. In this paper we review the historic background to the carpet making industry in Pakistan and look at its current conditions of production. We then go on to estimate an error correction model using conventional trade-related explanatory variables which include the volatility of exchange rates which has been increasingly a focus of such research. The results are broadly supportive of the existing aggregate and disaggregate literature for other countries. Given that the dominant rival supplier—Iran was subjected to constant and varying trade volume rationing activities by the USA, we then attempt to take this into account using measures of Iranian trade disadvantage. These results show that the problems faced by Iranian exporters have had a statistically significant positive impact on the Pakistan carpet export supply function.

Estimation of Export Supply Function for Citrus Fruit in Pakistan

Nature has blessed Pakistan with an ideal climate for growing a wide range of delicious fruits. Thus a very wide range of tropical, sub-tropical and temperate fruits are grown in the country. Over the years, Pakistani experts have developed unique strains of exotic fruit varieties. Pakistan is producing a large variety of fruits on an area of 734.6 thousand hectares with a total production of 5712.4 thousand tons. Out of this 354.4 thousand tons fruit is exported from the country [Pakistan (2004)]. Horticulture is an important sub-sector of agriculture and plays a vital role not only in rejuvenation of rural economy but also in improving human nutrition which is often deficient in ingredients such as vitamins and minerals. Citrus and mango are the main fruit crops which contribute substantially to the national income.

An analysis of export of indian agriculture commodities

The present work has attempted to examine the relationship between agricultural export and the effective factors influencing the same relationship in India. The review of literature has provided an overview of growth of agricultural exports across the countries and different methods used to calculate the export supply function of agricultural products. This study is based on the neoclassical trade theory which is evaluated in a neoclassical production function framework, incorporating an additional factor of production (exports) into the production function. The study has attempted to analyze the long run and the short run relationship between agricultural exports as dependent variable and exchange rate, export price index, gross domestic product and domestic production of agricultural product as independent variables based on annual data during 1980- 2010. Also, World Trade Organization as a dummy variable has been taken as a determinant of India's agricultural exports. The autoregressive distributed lag model and error correction model are used to determine the long run and short run relationship between the variables. Further, paired t-test is used to investigate the impact of WTO on growth of agricultural export in India. Dynamic econometric model is estimated to test for time series properties, unit root test and cointegration (ARDL procedure). The results of cointegration test showed that the variables are cointegrated. The results of long-run estimated coefficients of export supply function showed that exchange rate had a statistically significant and negative impact on agricultural export. The long-run coefficient of domestic production of agricultural product and export price index have positive sign and are significant at 5% level respectively. The long-run coefficients of Gross Domestic Product (GDP) and WTO as dummy variable had positive and negative sign respectively but are insignificant. In brief, the coefficient of the ECM is very high at (−) 0.54 implying a fairly high speed of adjustment to the long-run disequilibrium after a shock. The Coefficient of the ECM term suggested that adjustment process was fast and 54% of the previous year's disequilibrium in equity prices from its equilibrium path will be corrected in the current year. It is also observed that dummy variable is not significant in long run but it is statistically significant in short term.

Trade dynamics and export supply function of Indian groundnut

India is the leading groundnut exporter to world market. Direction of trade has changed over the period. Sphere of groundnut export has narrowed down from European nations during 1995-96 to Asian markets during 2014-15, with lost shares in UK, Netherland, Egypt, USA and Russia to Vietnam, Thailand, Pakistan, China, Ukraine and UAE. Indonesia was identified as highest loyal market followed by Malaysia. To identify the factors influencing groundnut export, Cointegration and Vector Error Correction Model were used. Export was found to increase significantly with export price and exchange rate and decrease significantly with increase in domestic price and increase in population. Speed of adjustment indicates the adjustment to the long-run equilibrium from short run shocks. Result highlights to target European market, the largest importer of groundnut in world.

Empirical analysis of US bilateral corn trade: Evidence from Japan, Mexico, China, South Korea, and the European Union

Aggregate export supply function for US corn and bilateral import functions for US corn by Mexico, Japan, China, South Korea, and the EU are estimated using ARDL estimation techniques. The findings...

Estimation of the Export Supply Function for Iron-ore Exports from Goa

The objective of this paper is to check whether the coefficients in the supply equation i.e. the price elasticities are consistent with the economic theory for iron-ore exports from a regional economy, the State of Goa. Since the export prices are endogenous the Two Stage Least Squares (TSLS) technique is employed as the first step in order to identify the supply equation using all exogenous variables in the equation as instruments using the fixed effect model. Subsequently, an alternative methodology employing a Dynamic Ordinary Least Squares (DOLS) given by Stock and Watson (1993) is estimated for the panel data on firm-level exports. In particular the price elasticity of supply has become positive over time and increased significantly in the recent periods. Thus the results indicate that these firms are more likely to respond to price signals going forward.

The effect trade and exchange rate policies on the export of stone fruit in Iran

This study aims to investigate the effect of foreign exchange rate and trade policies on crop exports in Iran. Regarding foreign exchange policies, the exchange rate volatility index and the dummy variable of currency uniformity policy were considered, while economic openness index as well as the trade bias coefficient index was studied for business policies. Logarithmic model of export supply function based on the ARDL and error correction model were used to estimate long- and short-term relations between variables. The research data were collected from the websites of the International Trade Statistics Database and the Central Bank of Iran from 1997 to 2014. The results showed that variables of commercial deviation coefficient, real exchange rate, economic openness, domestic product price, stone fruits export value in previous years and the dummy variable of currency uniformity policy all had a positive effect, in the long term, on Iranian stone fruits export. The coefficient for error correction model equals -0.42, which is quite significant indicating a very high modulation pace to a long-term equilibrium. In addition, the results revealed that, in the event of shock and distortion in balance in each period, 0.58% of the short-term imbalance has been adjusted to achieve long-term equilibrium.JEL Classification: Q17, Q18, F13, F17, F39

Competitive or recession gains? On the recent macroeconomic rebalances in the EMU

This paper assesses the long-run sustainability of rebalancing in trade positions within the Eurozone by looking at the impact of prices and Unit Labor Costs (ULCs) for core and peripheral countries. We estimate import demand and export supply functions and we decompose Real Effective Exchange Rates to separate the dynamics of the ULC elements – wages and labor productivity – and of consumer prices from those of nominal exchange rates. The rebalances of peripheral countries mainly resulted from the effect of domestic demand and inflation on imports, the persistence of these rebalances from that of international demand and wages on exports. Productivity plays a major role only in core countries. It follows that European adjustments are fragile.

Estimated Export Demand and Supply Functions for Pakistan: A Disaggregated Analysis

This study estimates the impact of demand and supply side factors on the export performance of Pakistan. Using unrestricted autoregressive distributed lag (ARDL) model for the period 1971 to 2015, the study analyzes export performance using data both at aggregate and disaggregate levels. The study finds, firstly, that exports are elastic to changes in world income and relative export price at the aggregate level. Secondly, at a disaggregate level, only exports of manufactured goods, leather and cotton cloth are elastic with respect to world income. Similarly, demand for all export categories is inelastic to changes in relative export price. On the supply side, exports at both aggregate and disaggregate levels are significantly elastic to changes in domestic production capacity and relative price. The study concludes that demand and supply side factors are equally important in explaining the export behavior at the aggregate level, whereas at a disaggregated level, the supply side factors exercise relatively high impact on export performance.

An Analysis of Export of Indian Agriculture Commodities

The present work has attempted to examine the relationship between agricultural export and the effective factors influencing the same relationship in India. The review of literature has provided an overview of growth of agricultural exports across the countries and different methods used to calculate the export supply function of agricultural products. This study is based on the neoclassical trade theory which is evaluated in a neoclassical production function framework, incorporating an additional factor of production (exports) into the production function. The study has attempted to analyze the long run and the short run relationship between agricultural exports as dependent variable and exchange rate, export price index, gross domestic product and domestic production of agricultural product as independent variables based on annual data during 1980- 2010. Also, World Trade Organization as a dummy variable has been taken as a determinant of India’s agricultural exports. The autoregressive distributed lag model and error correction model are used to determine the long run and short run relationship between the variables. Further, paired t-test is used to investigate the impact of WTO on growth of agricultural export in India. Dynamic econometric model is estimated to test for time series properties, unit root test and cointegration (ARDL procedure). The results of cointegration test showed that the variables are cointegrated. The results of long-run estimated coefficients of export supply function showed that exchange rate had a statistically significant and negative impact on agricultural export. The long-run coefficient of domestic production of agricultural product and export price index have positive sign and are significant at 5% level respectively. The long-run coefficients of Gross Domestic Product (GDP) and WTO as dummy variable had positive and negative sign respectively but are insignificant. In brief, the coefficient of the ECM is very high at (-) 0.54 implying a fairly high speed of adjustment to the long-run disequilibrium after a shock. The Coefficient of the ECM term suggested that adjustment process was fast and 54% of the previous year’s disequilibrium in equity prices from its equilibrium path will be corrected in the current year. It is also observed that dummy variable is not significant in long run but it is statistically significant in short term. Key words: agricultural exports, production function, Gross Domestic Product, WTO

Modelo de Análise da Oferta de Exportação de Milho Brasileira: 2001 a 2012

Resumo: Este estudo tem como objetivo estimar a função de oferta de exportação de milho para o Brasil, no período de 2001 a 2012. Para esta análise foi desenvolvido um modelo teórico, estimado utilizando-se cointegração e modelo de autorregressão vetorial com correção de erros (VEC). As variáveis utilizadas foram: exportação de milho, preço internacional do milho, abate de aves, preço da soja e PIB mundial. Os resultados alcançados apontaram a existência de relação de longo prazo entre as variáveis do modelo. O preço internacional do milho, o abate de aves, o preço da soja e o PIB mundial apresentaram sinais condizentes com o modelo teórico. Observou-se impacto positivo nas exportações de milho após um choque não antecipado no preço da soja e impacto negativo após um choque não antecipado no abate de aves. Já com relação ao preço internacional, verificou-se que um choque nessa variável provoca um impacto negativo sobre as exportações de milho. Com o objetivo de verificar as relações entre o preço doméstico e o preço internacional do milho, realizou-se o teste de exogeneidade fraca e constatou-se que, apesar deste mercado ainda não apresentar a Lei do Preço Único, mudanças no preço internacional do milho afetam o preço doméstico.

Do Exchange Rates Affect Exports in India?

It is shown that the 36 country real effective exchange rate (REER) of India, which is I(1), becomes stationary once a single exogenous shock (corresponding to the implementation of the liberalization policy by the government of India) is separated from its stochastic component and modelled as a break in the deterministic trend. The implication of this for the export supply function is enormous. While without the break real export has a long-run relationship with REER and gross domestic product, with the break the relationship no more exists. JEL Classification: F31, C32, F41

FDI and Export Linkage Revisited: The Case of Bangladesh

This empirical research examines the export effect of foreign direct investment (FDI) with reference to Bangladesh economy. An export supply function extended with the FDI variable has been employed with panel data. Econometric estimations unveil clear-cut contribution of inward FDI to boost export. Thus, this study ascertains that FDI and export are positively related to each other which mean trade and factor flows act as complements. Under such circumstance, higher growth of FDI will promote export growth.

Impact of FDI on Import Demand and Export Supply Functions of Pakistan: An Econometric Approach

FDI tends to increase the host country’s imports, because Multi-National Corporations (MNCs) often have a high tendency to import intermediate inputs, capital goods and services that are not readily available in the recipient countries as well as it also affect exports from the export supply side. We investigated the relationship between foreign direct investment (FDI) and imports demand as well as between foreign direct investment (FDI) and exports supply of Pakistan for the time span of 37 years range from 1973 to 2009. Our analysis emphasized on the existence of long run equilibrium relationship between FDI and imports demand & exports supply of Pakistan using econometric techniques (Co-integration Analysis and Error correction mechanism). The co-integration analysis of import demand showed stable long run equilibrium relation-ship between real import and FDI results of export expressed that FDI has positive relation with real exports in the long run, but the coefficient is statistically insignificant. It suggested that the inflow of FDI has largely been directed toward import-substitution industries or production for the domestic market while little has gone toward export-oriented industries. That is long run policies will be fruitful to be implemented. While the short term dynamics as analyzed by the error correction mechanism (ECM) revealed that the short term discrepancies were significant enough to not to converge toward equilibrium and will require a longer time to adjust back in both model. Unilateral causality was detected between real imports (RIM) and FDI which was established both by theoretic

Do Exchange Rates Affect Exports in India?

It is shown that the 36 country real effective exchange rate of India, which is I(1), becomes stationary once a single exogenous shock (corresponding to the implementation of the liberalization policy by the government of India) is separated from its stochastic component and modeled as a break in the deterministic trend. The implication of this for the export supply function is enormous. While without the break real export has a long run relationship with real effective exchange rate and gross domestic product, with the break the relationship no more exists.

Econometric Analysis of Radiata Pine Log Trade between New Zealand and East Asian Countries

There is an increasing interest in the sustainable supply of wood from New Zealand's plantation forests. This is due to the importance of New Zealand in global trade and uncertainty about the sustainability of supply from other countries, such as Russia. The aim of this paper is to identify important factors that influence log supply and demand for New Zealand and its key Asian markets (South Korea, Japan and China). To this end we used annual time series data from 1990 to 2008 to estimate export supply and import demand functions by two stage least squares with stepwise regression estimation. We found that New Zealand's log exports to Japan and South Korea are not sensitive to price, but exports to China are sensitive to price, while New Zealand's total harvest has a stronger influence on log export supply to China and South Korea. New Zealand's domestic log consumption competes with exports to Japan, but does not compete with supply to South Korea or China. Import demand in South Korea, Japan, and China for New Zealand logs is negatively affected by import price, with Japan's import demand the most price-sensitive. The three markets differ in the impact of gross domestic product on import demand. Gross domestic product has a strong positive impact on log demand in Japan and China, but a modest impact in South Korea.

Consumer Waste, Backhauling, and Pollution Havens

Pollution havens have received a great deal of attention in the past 15 years. However, the literature has focused almost exclusively on production side externalities and whether dirty industry migrates to countries with lax environmental laws. More recently, concerns have been raised about the rapid explosion of consumption side pollution such as e-waste and its trade in international markets. Between 1996 and 2007, US exports of waste plastics and ferrous waste along the USA-Asia trade route increased by 917% and 482%, respectively. Over the same time period the average freight rate on commercial liners along the USA-Asia trade route fell by 46%, while average freight rates along the Asia-USA trade route increased by 2.9%. This paper develops a two country trade model with endogenous asymmetric transport costs as well as externalities associated with harmful waste generated from consumption. It shows that even when both governments set optimal Pigouvian taxes on the consumption of the dirty good, endogenous asymmetric transport costs can lower the ‘backhaul’ rate from North to South. This creates an environmental arbitrage condition by which it is cheaper for the North to export its waste to the South rather than dispose of it at home. The model yields a number of clear predictions regarding the relationship between country characteristics, the international terms of trade, the backhaul shipping rate, and the North's export supply function of waste.

Examining Responsiveness of India’s Trade Flows to Exchange Rate Movements

Determinants of trade flows have always attracted researchers. In this paper, we model monthly trade flows in India over January 2000 - December 2007 in a bid to gauge their responsiveness to exchange rate movements. Capital account and overall BOP surplus have led the Indian Rupee (INR) to appreciate and forex reserves to accumulate. In so far as the RBI intervenes to stem this forex accretion by the net purchase of USD, it puts further pressure on the INR to appreciate. It therefore becomes important to study the response of the current account to these changes in the exchange rate. We employ standard empirical estimations of India’s export supply and import demand functions using data from the Reserve Bank of India. We also assess the short-term dynamics of these trade flows through error correction models. Finally, we estimate vector auto regression models to gauge the extent of contemporaneous interaction between trade flows and the explanatory variables in the system.

Análise do mercado brasileiro de celulose, 1969-2005

O segmento de celulose e papel contribui de forma significativa para a economia brasileira. O conhecimento da estrutura do mercado de celulose é fundamental para fins de planejamento da produção, comercialização e previsão para o setor. Este trabalho teve como objetivo principal especificar e estimar a oferta e demanda brasileira de celulose, bem como a oferta e a demanda de exportação, no período de 1969 a 2005. Os resultados, usando o método dos Mínimos Quadrados de Dois Estágios (MQ2E), indicaram que a oferta e a demanda interna de celulose, bem como a oferta e a demanda de exportação, são preço-inelástico. A demanda interna é inelástica com relação à renda. Já a demanda de exportação é elástica com relação à renda. A oferta interna é mais sensível a variações no preço das máquinas e equipamentos. A oferta de exportação é sensível a variações na produção e no consumo interno e a demanda de exportação, a variações na renda dos países importadores.