The Journal of Fisheries Business Administration (수산경영론집)

The Korean Society of Fisheries Business Administration (한국수산경영학회)
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A Study on the Market Integration of Major Import Fishery Products in South Korea Utilizing STAR Model

STAR 모형을 이용한 국내 주요 수입수산물 시장의 통합 여부에 관한 연구

  • Lim, Eun-Son (Division of International Commerce, Pukyong National University)
  • Received : 2020.09.15
  • Accepted : 2020.11.27
  • Published : 2020.12.31
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Abstract

I explore that South Korea's major import fishery product markets-frozen hairtail, frozen mackerel, frozen pollock and frozen squid-are integrated by testing whether there is favorable evidence of the law of one price (LOP). Unlike previous studies on the LOP for fishery product markets, I assume non-zero import costs and include them in a trade model. To explore whether LOP holds for major import fishery product markets in South Korea with non-zero import costs, I utilize a non-linear time-series model, Smooth Transition Autoregressive (STAR) model with the sample periods from January in 2002 to December in 2019. I find that the behaviors of home-foreign price (i.e., import price) differentials of all four major import fishery products are non-linear depending on whether trade occurs and favorable evidence of LOP for each import market in South Korea. These findings indicate that each of South Korea's major import fishery product markets is integrated. They imply that the supply of each major import fishery product-frozen hairtail, frozen pollock, frozen mackerel and frozen squid, and their prices are stable even if there is an economic shock on each market. When it comes to trade policy implications, the Korean trade policy including tariffs or quotas against their import countries for the four major import fishery products may not have influences on their price in the markets.

Keywords

Acknowledgement

이 논문은 부경대학교 자율창의학술연구비(2019년)에 의하여 연구되었음을 밝힙니다.

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