Non-Tariff Barrier Liberalization and Heterogeneous Price Responses in Korean Beef Markets: An GARCH Analysis of the 30 Month Age Restriction on U.S. Beef Imports

Minjung Kim, Dayeun Park and Do-il Yoo

No 404682, 2026 Annual Meeting, July 26 - 28, 2026, Kansas City, Missouri from Agricultural and Applied Economics Association

Abstract: Korea's age restriction on U.S. beef imports has remained one of the most contested nontariff measures in agricultural trade policy since its imposition following the 2003 BSE outbreak in the United States. This study empirically examines how relaxing this measure would affect price levels and conditional volatility across the structurally segmented Korean beef market, distinguishing between Hanwoo and Yukwoo cattle. Using monthly price data from July 2008 through December 2024, we estimate a tariff equivalent through the price wedge method, employing USDA cull cow prices as a counterfactual border price proxy. We then model the conditional volatility of each market using ARFIMA-eGARCH specifications with Student-t distributed errors to account for the long-memory properties and fat-tailed behavior characteristic of livestock price series. Major structural events including BSE, foot-and-mouth disease, the Korea-U.S. FTA, and the COVID-19 pandemic are controlled through dummy variables. Monte Carlo simulation under a 2027 NTM removal scenario projects price paths through 2030. Results show that the price level effects of NTM relaxation are minimal, averaging less than 0.4 percent annually for both market segments. However, conditional volatility rises meaningfully, by 1.53 percent for Hanwoo and 0.74 percent for Yukwoo. These findings suggest that the primary risk of import liberalization lies not in price collapse but in a sustained increase in price uncertainty that threatens farm income stability. Policy responses therefore need to prioritize volatility risk management over conventional price support.

Keywords: International; Relations/Trade (search for similar items in EconPapers)
Pages: 18
Date: 2026
References: Add references at CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/404682/files/1 ... 2026_Cowprice_v1.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea26:404682

DOI: 10.22004/ag.econ.404682

Access Statistics for this paper

More papers in 2026 Annual Meeting, July 26 - 28, 2026, Kansas City, Missouri from Agricultural and Applied Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().