The Effect of Exchange Rate Volatility upon Foreign Trade of Hungarian Agricultural Products

This paper takes a new empirical look at the long-standing question of the effect of exchange rate volatility on international trade flows of transition economies in Central Europe by studying the case of Hungarian agricultural exports to their export destination countries between 1999 and 2008. Based on a gravity model that controls for other factors likely to determine bilateral trade, the results show that nominal exchange rate volatility has had a significant positive effect on agricultural trade over this period. This positive effect of exchange rate volatility on agricultural exports suggests that agri-food entrepreneurs are not interested in speeding up the process of joining Hungary to the euro zone

Patterns and determinants of agro-food trade of the BRIC countries: The role of institution

Agro-food trade between the BRIC countries has increased. Brazil and China contributed to the rapid increase of agro-food trade. The Russian Federation experienced the stagnating and the most volatile agro-food trade over time. The composition of agro-food trade for the BRIC countries varies by the BEC agro-food trade categories and over time. The prevailing in the composition of agro-food trade are BEC122 and BEC111 for Brazil and the Russian Federation, and BEC122 and BEC112 for India and China. Brazil and India have strengthened their market shares in agro-food trade between the BRIC countries, while the Russian Federation has experienced the most severe deterioration. The number and the share of trading partners that have traded every year vary between the BRIC countries and the BEC agro-food trade categories over time. Agro-food trade between the BRIC countries is positively associated with the GDP size and population size in importing countries, but negatively associated with the GDP size and population size in exporting countries as well as with distance. Mixed results are found for border effect, institutional quality and institutional similarity depending on the BEC agro-food trade categories. --agro-food trade,BRIC countries,adapted gravity model,institutions

Impacts of climate on technical efficiency in the Hungarian arable sector

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Quality of institutions and the BRIC countries agro-food exports

Purpose – The purpose of this paper is to investigate the impacts of institutional quality (IQ) in exporting and importing countries on agro-food exports from the world's leading emerging economies: Brazil, the Russian Federation, India and China (BRIC countries). Design/methodology/approach – Measuring is based on using the gravity trade model and econometric panel data analysis for the period 1998-2009. Findings – Agro-food exports from the BRIC countries, particularly Brazil and China, have increased. The Russian Federation has experienced stagnating and volatile patterns. Brazil and India have strengthened market shares in the existing importing markets, while the Russian Federation has experienced severe deterioration. The export of existing products is more important than of new products. Agro-food exports are positively associated with IQ and the size of the gross domestic product in exporting and importing countries, but negatively with distance. Research limitations/implications – Among IQ variables, the focus is on the indices of legal structure and security of property rights and freedom to trade internationally in agro-food importing countries and the BRIC exporting countries. Practical implications – Different institutions and their quality can affect agro-food exports differently. The impact of institutions is not uniform across product groups. Originality/value – This paper adds the impacts of IQ on agro-food exports. Except for processed products for final household consumption, agro-food exports from the BRIC countries are positively associated with the quality of the legal structure, the security of property rights and the freedom to trade internationally as IQ in exporting and importing countries. </jats:sec

Külkereskedelem és külföldi működőtőke a magyar élelmiszeriparban = Trade and Foreign Direct Investment in the Food Industry: The Case of Hungary

Az FDI és az export egymást kiegészítő tényezők, amit két okkal magyarázhatunk. Egyrészt a multinacionális vállalatok működőtőke befektetéseivel, valamint a két ország közötti kereskedelemnek köszönhető méretgazdaságossággal, másrészt a gazdasági intézkedések hatásával. Az exportot elősegíti az importáló ország reál GDP-jének alakulása, a vámok viszont negatívan befolyásolják azt. A célország reál GDP-je szintén kedvezően hat az FDI alakulására, amit nagyobb piaci lehetőségekkel lehet kimutatni. A külföldi működőtőke befektetésre az árfolyam változások kedvezőtlen hatása mutatható ki. Magyarországon 1995-től a külföldi érdekeltségű vállalkozások száma csökkent az élelmiszeriparban, ezzel párhuzamosan a befektetések nagymértékű, 2,7-szeres növekedése figyelhető meg.A befektetések növekedésével együtt nőtt a külföldi érdekeltségű élelmiszeripari vállalatok exportja. | The FDI and export are complement that can be explained by two factors. On the one hand the foreign direct investment of the multinational companies and the economics of scale on the other hand protective measures are the explanatory factors. The export contribute to the GDP of the importer country, but the customs negatively influence export. The real GDP of the host country also positively influences the FDI as a result of potential market. The exchange rate volatility has a negative impact on foreign direct investment, as well. In Hungary the number of foreign owned companies have been decreasing from 1995. Parallel the value of foreign direct investment has went up radically (2.7-fold). At the same time the export of foreign owned company increased

The effects of weather risks on micro-regional agricultural insurance premiums in Hungary

This paper examines the effects of territorial differentiation of damage to wheat, maize, barley, sunflower and rapeseed production caused by drought and heavy rain. Our study evaluated the differences between LAU1 micro-regions in Hungary in the effects of the weather on agricultural production and found that there are extremely high differences in the probabilities of damage occurring. Therefore the design of agricultural insurance products should be based on different absolute deductibles and different insurance premiums for micro-regions. Furthermore, we found that within a micro-region individual producers face a very high diversity of risks which implies that in the long term only a bonus-malus system developed for individual agricultural producers can mitigate different risks, and that this can be the basis of a well performing risk management system that is suitable for a wide risk community