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Evaluating Welfare Effects of Rice Import Quota in Japan: Based on Measuring Non-Tariff Barriers of SBS Rice Imports

Qianhui Gao (), Shoichi Ito (), Kolawole Ogundari () and Hisamitsu Saito ()
Additional contact information
Qianhui Gao: School of Management, China University of Mining and Technology, Xuzhou 221116, China
Shoichi Ito: Department of Agricultural and Resource Economics, Faculty of Agriculture, Kyushu University, Fukuoka 8128581, Japan

Sustainability, 2016, vol. 8, issue 8, 1-13

Abstract: The principal objective of this study is to analyze welfare effects of Japan’s rice import quota focusing on the simultaneous buy and sell (SBS) of the rice importation minimum access (MA) policy. Based on the utility function specified in this study, the constructed model is adopted to measure consumption patterns through estimating elasticity of substitution between imported rice and Japan’s domestic rice, and consumers’ preference parameters for different kinds of rice. The results showed that Japanese households prefer domestic rice to the imported rice. Besides, three scenarios of adjusting rice quota volumes were carried out to examine the changes in consumer prices of imported rice and Japanese consumers’ welfares. The results revealed that tariff equivalents of the SBS import quota almost doubled the scale of the mark-up, and the intervention by the Ministry of Agriculture of Japan did cause non-tariff barriers to trade (NTBs). Finally, if the SBS rice quota quantity was fixed at or larger than 180 thousand tons every fiscal year, the consumer prices of imported rice in Japan’s market would decrease to be less than the prices of Japan’s domestic rice, and therefore the imported rice would have more price advantages in this scenario.

Keywords: simultaneous buy and sell (SBS); consumption patterns; elasticity of substitution; preference parameters; non-tariff barriers to trade (NTBs); tariff equivalents (search for similar items in EconPapers)
JEL-codes: Q Q0 Q2 Q3 Q5 Q56 O13 (search for similar items in EconPapers)
Date: 2016
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