Title: Implications of KORUS on US beef in South Korea

Authors: Andrew Muhammad; Jada M. Thompson; Karen L. DeLong

Addresses: Department of Agricultural and Resource Economics, University of Tennessee Institute of Agriculture, Knoxville, Tennessee, 37996, USA ' Department of Agricultural and Resource Economics, University of Tennessee Institute of Agriculture, Knoxville, Tennessee, 37996, USA ' Department of Agricultural and Resource Economics, University of Tennessee Institute of Agriculture, Knoxville, Tennessee, 37996, USA

Abstract: We examined the competitiveness of US beef in South Korea and assessed how the US-Korea free trade agreement (KORUS) impacted preferences for imported beef products by exporting source (USA, Australia, and the rest of world). Since KORUS entered into force in 2012, US beef exports to Korea have increased 87% and the US is now the leading beef exporter to Korea. Overall, results indicated limited competition across exporting countries as evidenced by the insignificant cross-price estimates. However, we did find evidence of habit formation for US beef which indicates the success of KORUS for the US beef industry and underscores the critical desire to maintain this agreement. When examining how habit formation changed after the implementation of KORUS, we find clear evidence of an increase in preferences for US chilled beef in the South Korean market.

Keywords: beef; demand; KORUS; imports; Rotterdam model; South Korea; USA.

DOI: 10.1504/IJTGM.2020.111123

International Journal of Trade and Global Markets, 2020 Vol.13 No.4, pp.378 - 393

Received: 11 Mar 2019
Accepted: 29 May 2019
Published online: 10 Nov 2020 *

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