Working Papers
Job Market Paper: Assessing the Impacts of Equivalency Agreements in International Organic Trade
(Full text of Appendix C is available here.)
This study investigates the effects of Organic Equivalency Agreements (OEAs) on the imports of organic food
products into the United States (U.S.) and Denmark. Using organic trade flow data from 2011-2016, the BLP method
(Berry, Levinsohn, and Pakes, 1995) is used to estimate market share elasticities with respect to the establishment
of OEAs. In addition, the export values an exporter signed an OEA with the importing country in 2016 are predicted.
The results indicate that OEAs have a positive effect on the value of exports for most exporting countries exporting
to the two markets. Exceptions to this are OEAs between U.S.-Tunisia, U.S.-Turkey, U.S.-Ukraine, and
Denmark-Philippines, Denmark-Cambodia, Denmark-Pakistan. On average, trade between countries who were OEA
partners occupied higher market shares relative to those who were not signatories to an OEA. Based on this model,
if the U.S. had signed an OEA with one of its non-OEA organic food exporter, the U.S. would have imported an
average of $205 million from the newly established OEA partner, 650% increase of the actual traded value in 2016.
For Denmark, organic food imports would have increased by $7 million (350% increase) on average by signing a
new OEA. Further, the findings suggest that market share increases for an exporter in a newly established OEA
come at the expense of the decreased market shares of other OEA and non-OEA exporting countries. The sensitivity
of the remaining exporting countries to the reduction of trade costs from a newly established OEA depends on the
extent to which the organic food products sold by these competitive exporting countries are close substitutes.
Measuring the Impacts of Compliance Cost on Extensive Margin of Organic Trade:
a Bayesian Approach (with Kathryn Boys)
This study aims to contribute to the theoretical foundation of international literature related to heterogeneous firm
model with spillover effect, and to answer empirical questions concerning the effect of local certification bodies and
mutual standards recognition on the number of firms that decide to export. I extend these models by further taking
into consideration exporter heterogeneity within products. This type of heterogeneity is due to consumers' preference
heterogeneity for country-of-origin, and the heterogeneity in organic producers' exogenous fixed cost (referred to
compliance cost in this study). The hierarchical Bayesian method is employed to estimate the posterior distribution
of parameters and to fit a more flexible structure.
Quantifying Consumer's Willingness to Pay for Low-Documentation Loan in Chinese Auto Industry
This study investigates consumer's willingness to pay for low-documentation loans using transaction-level data
from a Chinese automobile loan company during the period 2014-2017. Low-documentation loan refers to the
auto loan product which has no requirement of screening for consumer’s bank statements and the consumer’s
loan size is below a certain threshold set by the loan company. I find that consumers are willing to pay 43.68
percent of the car price as a down payment on average to obtain the low-documentation loan, and the preference
for low-documentation loan is significantly large for elder, wealthier and single/divorced consumers. The consumer
surplus would have increased by 149,200 RMB (Chinese currency) on average when the loan company offered
low-documentation loan.
(Full text of Appendix C is available here.)
This study investigates the effects of Organic Equivalency Agreements (OEAs) on the imports of organic food
products into the United States (U.S.) and Denmark. Using organic trade flow data from 2011-2016, the BLP method
(Berry, Levinsohn, and Pakes, 1995) is used to estimate market share elasticities with respect to the establishment
of OEAs. In addition, the export values an exporter signed an OEA with the importing country in 2016 are predicted.
The results indicate that OEAs have a positive effect on the value of exports for most exporting countries exporting
to the two markets. Exceptions to this are OEAs between U.S.-Tunisia, U.S.-Turkey, U.S.-Ukraine, and
Denmark-Philippines, Denmark-Cambodia, Denmark-Pakistan. On average, trade between countries who were OEA
partners occupied higher market shares relative to those who were not signatories to an OEA. Based on this model,
if the U.S. had signed an OEA with one of its non-OEA organic food exporter, the U.S. would have imported an
average of $205 million from the newly established OEA partner, 650% increase of the actual traded value in 2016.
For Denmark, organic food imports would have increased by $7 million (350% increase) on average by signing a
new OEA. Further, the findings suggest that market share increases for an exporter in a newly established OEA
come at the expense of the decreased market shares of other OEA and non-OEA exporting countries. The sensitivity
of the remaining exporting countries to the reduction of trade costs from a newly established OEA depends on the
extent to which the organic food products sold by these competitive exporting countries are close substitutes.
Measuring the Impacts of Compliance Cost on Extensive Margin of Organic Trade:
a Bayesian Approach (with Kathryn Boys)
This study aims to contribute to the theoretical foundation of international literature related to heterogeneous firm
model with spillover effect, and to answer empirical questions concerning the effect of local certification bodies and
mutual standards recognition on the number of firms that decide to export. I extend these models by further taking
into consideration exporter heterogeneity within products. This type of heterogeneity is due to consumers' preference
heterogeneity for country-of-origin, and the heterogeneity in organic producers' exogenous fixed cost (referred to
compliance cost in this study). The hierarchical Bayesian method is employed to estimate the posterior distribution
of parameters and to fit a more flexible structure.
Quantifying Consumer's Willingness to Pay for Low-Documentation Loan in Chinese Auto Industry
This study investigates consumer's willingness to pay for low-documentation loans using transaction-level data
from a Chinese automobile loan company during the period 2014-2017. Low-documentation loan refers to the
auto loan product which has no requirement of screening for consumer’s bank statements and the consumer’s
loan size is below a certain threshold set by the loan company. I find that consumers are willing to pay 43.68
percent of the car price as a down payment on average to obtain the low-documentation loan, and the preference
for low-documentation loan is significantly large for elder, wealthier and single/divorced consumers. The consumer
surplus would have increased by 149,200 RMB (Chinese currency) on average when the loan company offered
low-documentation loan.