Theses and Dissertations at Montana State University (MSU)
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Item The effects of trade restrictions on basis(Montana State University - Bozeman, College of Agriculture, 2021) Anderson, Laina Dee; Chairperson, Graduate Committee: Joseph AtwoodAfter accusing China of stealing intellectual property and engaging in unfair trade practices, the United States announced a $46.2 billion tariff on Chinese imports in April 2018. Immediately, China announced a retaliatory 25 percent tariff on soybean imports from the United States. Both tariffs went into effect on July 6, 2018. Due to China historically buying 60 percent of total U.S. soybean exports the tariff had a major effect on the soybean market as 2018 exports dropped by 74 percent compared to 2017 exports (Ward, 2018; Adjemian et al., 2019). While the soybean futures contract price dropped nearly two dollars, research has not studied the consequences on prices in local markets where almost all marketing transactions occur. Using a difference-in-differences model with corn basis as a counterfactual, I measure the relative change in soybean basis between the announcement period and after the tariff went into effect across 3,222 cash markets. The results suggest that basis for soybeans weakened five cents per bushel relative to its expected relationship with corn basis during the intermediate period, and after the tariff went into effect in July, soybean basis weakened an additional 14 cents per bushel and remained relatively weaker throughout the rest of 2018. The tariff caused basis to weaken in every state, Minnesota and Oklahoma soybean farmers faced the largest effects, with soybean basis weakening 25 cents and 23 cents per bushel relative to corn, respectively. Missouri and Nebraska faced the lowest impact, with soybean basis weakening 12 and 15 cents per bushel relative to corn basis, respectively.Item The effectiveness of trade adjustment assistance : a case study(Montana State University - Bozeman, College of Agriculture, 1976) Miller, Diane Pauline CarlsonItem Effects of free trade agreements on U.S. automobile prices(Montana State University - Bozeman, College of Agriculture, 1999) Uitdewilligen, Gerardus Bernardus; Chairperson, Graduate Committee: Robert K. Fleck.Trade in automobiles and automotive parts between the United States, Canada and Mexico has more than doubled since 1985. Trade agreements implemented during this time period could be a reason for the increased trade. No earlier research has been conducted for this time period to determine the price effects of the free trade agreements. This thesis explores the price effects of reallocating automobile assembly capacity outside the United States, focusing on the price effects for U.S. automobile consumers. The regression results suggest that automobiles assembled in Canada or Mexico have not become cheaper compared to U.S. only assembled automobiles after implementation of the trade agreements. However, U.S. new automobile buyers have benefitted from the free trade agreements. Prices of new automobiles in the U.S. have fallen relative to other goods. These price decreases are for all automobiles regardless of assembly origin.Item Central bank holdings of foreign exchange reserves : why have they grown so fast?(Montana State University - Bozeman, College of Agriculture, 2010) Gantt, Ryan Preston; Chairperson, Graduate Committee: Douglas J. Young.The first decade of the twenty-first century witnessed an historically unprecedented rise in the quantity of assets held as foreign exchange reserves by central banks. The locus of this rise has been in east Asia. By analyzing the change in reserve accumulation behavior which followed the financial crises that swept the globe in the late 1990s, this paper puts forth an explanation of the rise in East Asian reserve holdings based on increased sensitivity to perceived crisis risk by the Asian "Tigers" (including Japan and China). Our findings indicate that not only are reserve holdings worldwide higher since the end of the 1990s in real terms, but that the increase in East Asian reserve holdings has outpaced the rest of the world by a factor of 6. Empirical results corroborate the hypothesis that the relevant channel of influence for this change is through the interaction of exchange rate policy-specifically, a "fixed" exchange rate regime-and the extent to which a country engages in international trade.Item The effects of domestic and trade policy variables on the U.S. beef wholesale and slaughter markets(Montana State University - Bozeman, College of Agriculture, 1990) Jeong, Kyeong-Soo; Chairperson, Graduate Committee: John M. Marsh.Trading in beef products has been increasing during the 1980's and its impact on the U.S. beef industry has become an important issue for various interest groups. Particularly, U.S. by-product exports have become a large value item in U.S. beef product exports and contribute greatly to meat packer returns and Japanese beef import quotas have become less stringent. The main objective of this study is to develop a dynamic structural model of the U.S. wholesale carcass and slaughter cattle industry. The model incorporated pertinent domestic variables and foreign trade variables such as imports and exports of beef and veal, live cattle imports, and by-product exports. The econometric model explicitly includes U.S. carcass demand and supply, U.S. slaughter demand and supply, beef and veal import demand and supply, beef and veal export demand and supply, live cattle import demand and supply, and foreign trade in farm level by-products. The empirical model was estimated within a rational distributed lag framework, using instrumental variables with either the maximum likelihood or ordinary least squares procedure depending upon the nature of the stochastic error terms. The short-run and long-run impacts of the exogenous variables on the dependent variables are calculated using sequential partial derivatives involving the difference equation coefficients and slope parameters. The distributed lag impacts of trade shocks on the U.S. beef prices are calculated using reduced form coefficients specific to selected exogenous and predetermined variables combined with price transmission effects between market levels. The empirical results show that most of the foreign trade variables were statistically significant and demonstrated theoretically correct signs. The long-run impacts of foreign trade in beef products were generally small but were large enough to suggest that incorporating foreign market arguments in the framework of dynamic analysis is important in a U.S. beef market analysis. However, the use of monthly or quarterly data and disaggregate price and quantity data for the trade variables would be more desirable in order to reduce aggregation bias.Item The causes of protection in the Japanese beef industry(Montana State University - Bozeman, College of Agriculture, 1986) Lloyd, Roger Edwin; Chairperson, Graduate Committee: Michael D. Frank; Merle Faminow (co-chair)Recently, Japan's markets have received considerable attention in the United States concerning their degree of protection. This study analyzes the degree and underlying causes of protection in the Japanese beef industry from 1963-1983. The Japanese beef industry was chosen due to its high trade barrier visibility and its importance in United States-Japan trade negotiations. Effective protection rates are applied as a measure of protection. Five economic regulation models are developed as possible explanations for the level of protection. An empirical analysis is conducted to determined which model best explains actual levels of protection. Protection in the Japanese beef industry appears to be directly related to the share of farm population and inversely related to farm income levels. This result implies that current levels of protection are likely to decrease if certain demographic trends in Japan, e.g., declining farm population and declining farm income, continue.