Open AccessDo U.S. agriculture suppliers benefit from South Korea- U.S. Free Trade Agreement – the case of orange juice
Author(s) -
Yan Heng,
Lisa House
Publication year - 2018
Publication title -
the international food and agribusiness management review
Language(s) - English
Resource type - Journals
eISSN - 1559-2448
pISSN - 1096-7508
DOI - 10.22434/ifamr2017.0081
Subject(s) - free trade agreement , orange juice , agriculture , international trade , economics , welfare , international economics , agricultural economics , business , competition (biology) , free trade , geography , market economy , food science , chemistry , archaeology , ecology , biology
This paper investigates the effect of the South Korea-U.S. Free Trade Agreement (KORUS-FTA) on U.S. competition with other suppliers for the import/export of orange juice. We use monthly trade data for 2007- 2015 to estimate the import demand from the United States, Brazil, Israel, and the rest of the world. Our results suggest that U.S. suppliers have surpassed Brazil and dominate the market. Moreover, we show that thanks to the KORUS-FTA, U.S. suppliers have gained significant welfare and trade value, which is particularly important for industries suffering from a shrinking domestic market.