Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/70478 
Year of Publication: 
2013
Series/Report no.: 
Economics Discussion Papers No. 2013-22
Publisher: 
Kiel Institute for the World Economy (IfW), Kiel
Abstract: 
The paper analyzes the potential trade distortion effects of state trading enterprises (STEs) on soybean imports to Korea. Traditionally, STEs have exercised exclusive rights to import the so-called strategic products, to ensure food security, domestic price stabilization, and import mark-ups. However, STE imports have been criticized on the grounds that industries using soybeans as a raw material are unable to obtain a diverse mix of quality material and cannot exercise the right to choose their own ingredients. Under a theoretical framework, a tariff equivalent of the STE is postulated to equate imports by private firms with imports by the STE. An empirical model is constructed and estimated using annual data spanning 1980-2009. The estimated results show that providing exclusive rights to imports has a negative effect on market access. When the STE pursues consumer welfare, the import-reducing effect turns out to be smaller than that in the producer welfare maximization case.
Subjects: 
state trading enterprises
tariff-rate quotas
tariff equivalents
soybeans
sensitive products
JEL: 
F11
F13
Q17
Creative Commons License: 
cc-by Logo
Document Type: 
Working Paper

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