Research Project
Traders in the food value chain - firm size and international food distribution (TRADERS)
Events
The project examines organization, market structure and distribution along the value chains in international food trade, focusing on Norway's seafood exports and agricultural exports and imports.
To what extent is the export success for salmon due to skilled traders? Does the organization of trade vary across seafood products, and which mode is more efficient? Is the organization of trade different for large and small firms?
These are among the questions raised in this inter-disciplinary research project carried out by NUPI, SNF/Bergen and Ruralis/Trondheim, with international partners in the USA, UK and India. While the organization of seafood exports is studied by NUPI and SNF, Ruralis has undertaken case studies of Norwegian exports of differentiated goods. Do the firms have what it takes to export, or is distribution limited to the local markets?
NUPI and SNF analyse Norwegian imports of agricultural goods:
- How is import organization and market structure affected by tariffs and quotas?
- How do the ever more stringent rules for food safety affect the organization of trade; are small firms able to handle this?
- Norway is a small country with peripheral location: Imports of e.g. flowers occurs indirectly via the Netherlands or Germany. What role do intermediaries play in trade?
- Through case studies and analysis of trade data we will find out how Norway differs from other countries: Are flower imports into the UK, or agricultural imports into Switzerland, organized differently from Norway?
- Imports from Asia are doubled in value on the way to Norway; is this true also for other European countries?
In cooperation with customs authorities, we track trade for selected goods, to develop new tools for control and analysis. A reference group with key seafood and agriculture firms also contributes in the project.
In the following, we provide some key words about some work in the project:
- Frank Asche has jointly with American colleagues in two articles analysed how aquaculture has transformed global seafood markets. The growth in aquaculture globally has led to higher seafood consumption and stimulated larger scale, modern logistics and new approaches to marketing.
- Hege Medin has, using Norwegian trade data, shown that the large majority of exporters and importers use customs brokers for the clearing of their goods. Small firms rarely have the capacity to declare the goods by themselves. In another article published in the project, Medin shows theoretically and empirically that the share of firms that are exporters, tends to be larger in small countries.
- Jostein Vik and Gunn-Turi Kvam have in two articles analysed agriculture-based Norwegian exports, where producers often cooperate with traders in order to obtain market access. In their contributions, the authors analyse how export is organised and its potential.
- In various contributions, Hans-Martin Straume, Frank Asche and Erling Vårdal have analysed seafood exports at the firm level, and whether changes in trade are driven by firm exit or entry, or changes in sales for firms that are already in the markets. One article shows that transport costs have a stronger impact on trade than what has been expected from earlier research. Another article shows that in cod exports of, the trade relations between exporters and importers are of short duration, and this volatility is high for seafood exports.
- The international participants have contributed new insight on food trade in developing countries: Flower trade in developing countries and the UK (Jodie Keane, ODI), the fisheries sector in India (Meenakshi Rajeev, ISEC), and the meat exports of Botswana/Namibia including trade with Norway (Ben Bennett, NRI/Univ. of Greenwich and Karl Rich, Lincoln University/CGIAR).
- In the project, there have also been a large number of presentations in academic seminars/conferences but also for users in Norway and abroad.
Project Manager
Participants
External
Ruralis, Institute for Rural and Regional Research, Trondheim
Centre for Applied Research at NHH (SNF), Bergen
Natural Resources Institute (NRI), University of Greenwich, Gillingham, UK
ISEC (Institute for Social and Economic Change), Bangalore, India
ODI (Overseas Development Institute), London, UK
Directorate of Norwegian Customs, Oslo
Publications written by external partners:
- Anderson, J. L., F., Asche. T. Garlock and J. Chu, 2017, Aquaculture: Its Role in the Future of Food World Agricultural Resources and Food Security, pp. 159-173 in A. Schmitz , P. L. Kennedy & T. G. Schmitz (Eds.), World Agricultural Resources and Food Security: International Food Security, Frontiers of Economics and Globalization Volume 17, Emerald Publishing Limited.
- Asche & T. Garlock, 2018, Globalization and Commoditization: The Transformation of the Seafood Market, Journal of Commodity Markets 12: 2-8.
- Asche F., C. Roheim & M. D. Smith, 2016, Trade Intervention: Not a Silver Bullet to Address Environmental Externalities in Global Aquaculture, 69: 194-201, Marine Policy, ISBN 0308-597X.
- Straume, Hans-Martin, 2017, Here today gone tomorrow: the duration of Norwegian Salmon Export, Aquaculture Economics and Management 21(1), s. 88- 104. Doi: 10.1080/13657305.2017.1262477.
- Straume, Hans-Martin & Erling Vårdal, 2015, The performance of large versus specialized firms: A study of firms importing apples into Norway. Working Papers in Economics 07/15, University of Bergen, Department of Economics.
- Rajeev, Meenakshi and Bhandarkar, Supriya, 2016, A Study of Domestic Marketing Channels of Fisheries in Bangalore City (March 15, 2016). Social Science Research Network.
- Rajeev, Meenakshi & Supriya Bhandarkar, 2016, A Study of Domestic Marketing Channels of Fisheries in Bangalore City Social Science Research Network Page no. Issue/Volume/Year ISSN/ISBN
- Straume, Hans-Martin, 2014, Currency Invoicing in Norwegian Salmon Export, Marine Resource Economics 29, no. 4 (December 2014): 391-409.
- Rajeev, Meenakshi & Pranav Nagendran, 2018, Decency of primary occupations in the Indian fishing industry, Kassel University Press ICDD Working Papers 21/2018, ISBN: 978-3-7376-0452-9.
- Asche, F., Cojocaru, A. L., Gaasland, I., & Straume, H. M., 2018, Cod stories: Trade dynamics and duration for Norwegian cod exports. Journal of Commodity Markets Volume 12, December 2018, Pages 71-79. ISSN: 2405-8513
- Vik, Jostein & Gunn-Turid Kvam, 2017, Governance and growth - A case study of Norwegian whey protein concentrate exports. International Journal on Food System Dynamics 8/2017: 336-346, ISSN/ISBN 1869-6945
- Vik, Jostein & Gunn-Turid Kvam, 2017, Trading Growth - A Study of the Governance of Norwegian Whey Protein Concentrate Exports, Proceedings in Food System Dynamics 8(4): 145-154 2017 ISSN/ISBN 2194-511X.
New publications
Trade barriers or trade facilitators? The heterogeneous impact of food standards in international trade
Recent research shows that the effect of food standards can be heterogeneous across sectors or countries: they sometimes act as barriers to trade, but in other cases may lead to increased trade. Hege Medin presents empirical evidence on Norwegian seafood exports showing that foreign food standards, measured by sanitary and phytosanitary notifications to the WTO, generally have a negative impact on total exports, the number of exporters and their average exports. However, for fresh seafood, there is a positive counteracting effect. Medin presents a theoretical explanation for this, suggesting that food standards reduce consumer uncertainty about quality and safety and therefore increase demand.
The reverse home market effect in exports: a cross-country study of the extensive margin of exports.
Customs-brokers as facilitators in international trade
Recent studies suggest that firms can reduce fixed trade costs by hiring intermediaries like trading companies. I argue that customs brokers – a type of intermediary rarely studied in economics before – can play a similar role. Using panel data of Norwegian trade transactions, I show that such brokers are commonly used to clear goods through customs. I find indications of lower sunk costs as well as fixed trade costs for firms that hire such services. However, engaging brokers can be risky, and traders in high-risk products like food are more likely to self-declare. Results are similar for importing and exporting, indicating that customs brokers facilitate both modes of trade.
Darwinistisk seleksjon i en global økonomi
(This article is available in Norwegian only): Det siste tiåret har det blitt utviklet en ny retning innen samfunnsøkonomisk teori om internasjonal handel, såkalt ny-ny handelsteori. Teorien er inspirert av empiriske studier av handelsdata på bedriftsnivå og kan forklare en rekke særtrekk vi observerer ved eksportører, som for eksempel at de har langt større omsetning og er mer produktive enn ikke-eksportører. Teorien kan videre forklare hvordan slike forskjeller på mikronivå får konsekvenser for makroøkonomiske størrelser. Økt globalisering gjennom reduksjon i handelskostnader kan føre til økt gjennomsnittlig produktivitet innad i næringer gjennom darwinistisk seleksjon av bedrifter – små og lite produktive bedrifter blir erstattet av større og mer produktive. Artikkelen gir en oversikt over de grunnleggende mekanismene i den nye teorien samt noen sentrale utvidelser.
Market-specific Sunk Export Costs: The Impact of Learning and Spillovers
Firms may face sunk costs when entering an export market. Previous studies have focused on global or country-specific sunk export costs. This study analyses the importance of market-specific sunk export costs (defining ‘market’ as a product–country combination). We also study how market-specific export costs can be affected by various kinds of learning and spillover effects. We use firm-level panel data for Norwegian seafood exports distributed on products and countries. The results lend support to the hypothesis of market-specific sunk costs. We also find evidence of learning and spillover effects, particularly within the same product group.
Project Manager
Events
Participants
External
Ruralis, Institute for Rural and Regional Research, Trondheim
Centre for Applied Research at NHH (SNF), Bergen
Natural Resources Institute (NRI), University of Greenwich, Gillingham, UK
ISEC (Institute for Social and Economic Change), Bangalore, India
ODI (Overseas Development Institute), London, UK
Directorate of Norwegian Customs, Oslo
Publications written by external partners:
- Anderson, J. L., F., Asche. T. Garlock and J. Chu, 2017, Aquaculture: Its Role in the Future of Food World Agricultural Resources and Food Security, pp. 159-173 in A. Schmitz , P. L. Kennedy & T. G. Schmitz (Eds.), World Agricultural Resources and Food Security: International Food Security, Frontiers of Economics and Globalization Volume 17, Emerald Publishing Limited.
- Asche & T. Garlock, 2018, Globalization and Commoditization: The Transformation of the Seafood Market, Journal of Commodity Markets 12: 2-8.
- Asche F., C. Roheim & M. D. Smith, 2016, Trade Intervention: Not a Silver Bullet to Address Environmental Externalities in Global Aquaculture, 69: 194-201, Marine Policy, ISBN 0308-597X.
- Straume, Hans-Martin, 2017, Here today gone tomorrow: the duration of Norwegian Salmon Export, Aquaculture Economics and Management 21(1), s. 88- 104. Doi: 10.1080/13657305.2017.1262477.
- Straume, Hans-Martin & Erling Vårdal, 2015, The performance of large versus specialized firms: A study of firms importing apples into Norway. Working Papers in Economics 07/15, University of Bergen, Department of Economics.
- Rajeev, Meenakshi and Bhandarkar, Supriya, 2016, A Study of Domestic Marketing Channels of Fisheries in Bangalore City (March 15, 2016). Social Science Research Network.
- Rajeev, Meenakshi & Supriya Bhandarkar, 2016, A Study of Domestic Marketing Channels of Fisheries in Bangalore City Social Science Research Network Page no. Issue/Volume/Year ISSN/ISBN
- Straume, Hans-Martin, 2014, Currency Invoicing in Norwegian Salmon Export, Marine Resource Economics 29, no. 4 (December 2014): 391-409.
- Rajeev, Meenakshi & Pranav Nagendran, 2018, Decency of primary occupations in the Indian fishing industry, Kassel University Press ICDD Working Papers 21/2018, ISBN: 978-3-7376-0452-9.
- Asche, F., Cojocaru, A. L., Gaasland, I., & Straume, H. M., 2018, Cod stories: Trade dynamics and duration for Norwegian cod exports. Journal of Commodity Markets Volume 12, December 2018, Pages 71-79. ISSN: 2405-8513
- Vik, Jostein & Gunn-Turid Kvam, 2017, Governance and growth - A case study of Norwegian whey protein concentrate exports. International Journal on Food System Dynamics 8/2017: 336-346, ISSN/ISBN 1869-6945
- Vik, Jostein & Gunn-Turid Kvam, 2017, Trading Growth - A Study of the Governance of Norwegian Whey Protein Concentrate Exports, Proceedings in Food System Dynamics 8(4): 145-154 2017 ISSN/ISBN 2194-511X.