Year of Publication

2012

Degree Name

Doctor of Philosophy (PhD)

Document Type

Doctoral Dissertation

College

Agriculture

Department

Agricultural Economics

First Advisor

Dr. Michael Reed

Second Advisor

Dr. Sayed Saghaian

Abstract

Food safety scares affect consumption behavior, and food safety and animal health issues are increasingly impacting international agricultural trade. Foot-and-mouth disease (FMD) is a highly contagious viral-type disease, and has raised not only the concerns of animal health issue but also food safety issue. Over 58 countries in the world have experienced FMD outbreaks, and pork exports and imports among these countries are largely impacted. This dissertation focuses on how global pork trade is affected by FMD.

This dissertation consists of three parts: first, this study specifically focuses on the market of U.S. pork exports. Results show that disease-affected pork importers are potential traders with the U.S., and only importing countries with a vaccination policy are more likely to increase pork imports from the U.S. rather than those importers with a slaughter policy. Second, a further investigation focuses basic hypothesis on import demand of FMD-affected importers by using a gravity model with fixed-effects to show how pork trade is affected by FMD among 186 countries. Results confirm that pork export falls when an exporting country develops FMD. Exporters with a vaccination policy have larger negative impacts than those with a slaughter policy. Further, pork importers that develop FMD and institute a slaughter policy will import more pork, but importers with a vaccination policy import the same level of pork. Third, the findings of part one and two reveal that FMD-free pork exporters face different market opportunities when pork importers have FMD outbreaks. Hence, four major FMD-free pork exporters, such as Canada, U.S., Germany, and Spain, are further investigated. Results confirm that the impacts of foreign FMD have altered pork exporters differently. Germany has gained the most exports during foreign FMD outbreaks in pork importers; the U.S. is second; Spain is third; and Canada is fourth.

In sum, this dissertation contributes to the literature of gravity model when endogeneity and heteroskedasticity may coexist, when an extremely large number of zero observations are included, when single commodity for one specific exporter is analyzed, when a spatial econometric approach is compared, and when pork export market has been altered by foreign FMD outbreaks.

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