The Economic Impact of Government Policy on Market Prices of Low-Fat Pork in South Korea : A Quasi-Experimental Hedonic Price Approach

The implementation of government policy can have an influence on market environment and market prices of pork in consequence. In South Korea, consumers prefer high-fat pork cuts due to the prevalence of roosting pork over a hot grill. This paper examines the impact of the government policy which aims to increase the consumption of low-fat pork cuts because of the concerns regarding asymmetric consumption between high-fat and low-fat pork cuts. Using hedonic price methods combined with quasi-experimental approaches we estimate the subsequent impact of food policy on the price of low-fat pork cuts using a time series of sales data. This study utilized an effective approach which has been widely employed for policy evaluation to produce plausible estimates of the economic values generated by the government policy. We find the existence of market segmentation and different impacts of the policy between markets. While the market price for high-fat pork cuts has remained stable, the price for low-fat pork cuts has slightly increased since the policy has been implemented. This paper illustrates that government’s policy can be a good strategy to maintain sustainability of the food industry by improving the balance in pork consumption and the management of stocks

Prediction of severe accident occurrence time using support vector machines

AbstractIf a transient occurs in a nuclear power plant (NPP), operators will try to protect the NPP by estimating the kind of abnormality and mitigating it based on recommended procedures. Similarly, operators take actions based on severe accident management guidelines when there is the possibility of a severe accident occurrence in an NPP. In any such situation, information about the occurrence time of severe accident-related events can be very important to operators to set up severe accident management strategies. Therefore, support systems that can quickly provide this kind of information will be very useful when operators try to manage severe accidents. In this research, the occurrence times of several events that could happen during a severe accident were predicted using support vector machines with short time variations of plant status variables inputs. For the preliminary step, the break location and size of a loss of coolant accident (LOCA) were identified. Training and testing data sets were obtained using the MAAP5 code. The results show that the proposed algorithm can correctly classify the break location of the LOCA and can estimate the break size of the LOCA very accurately. In addition, the occurrence times of severe accident major events were predicted under various severe accident paths, with reasonable error. With these results, it is expected that it will be possible to apply the proposed algorithm to real NPPs because the algorithm uses only the early phase data after the reactor SCRAM, which can be obtained accurately for accident simulations

Benefit Transfer for Water Management along the Han River in South Korea Using Meta-Regression Analysis

This study estimates the magnitude of economic benefits that are justified in transfer from downstream users to upstream users for the use of the Han River in South Korea in terms of foregone economic benefits by regulations. Based on the existing non-market valuation studies associated with water management issues in South Korea from 1997 to 2014, a meta-regression analysis was performed to provide alternatives for regional benefit sharing of water resource use. The benefits from the use of water resource along the Han River are estimated on average to be KRW 7,728 (US $7.7) per household per month. The total net benefits are estimated to be about KRW449 billion (US$449 million) per year. Following the principle regarding equal distribution of benefits, the stakeholders who received more net benefits than others should return their extra net benefits to other stakeholders through a policy tool such as tradable development rights. The results of our study provide economic indicators useful for the establishment of common resource policy and to consider stakeholders' rights within the framework of regional benefits. This study also provides practical solutions that could be used as a valid policy instrument to mediate the conflicts and disputes associated with water resource use.Kangwon National UniversityUniversity of Bayreut

Do Consumers of Environmentally Friendly Farming Products in Downstream Areas Have a WTP for Water Quality Protection in Upstream Areas?

In South Korea, the Soyang Lake is an important source of drinking water to the metropolitan areas including Seoul. However, water quality problems in the Soyang Lake have still remained due to chemical contaminations attributed to conventional farming practices in the upstream areas. Based on a downstream consumer survey using a contingent valuation method, this study estimated the expected willingness to pays (WTPs) for water quality improvement through the conversion to environmentally friendly farming (EFF). The results showed that the estimated annual mean WTP is KRW 36,115 per household. The aggregated WTPs of downstream respondents in the Soyang Lake are sufficient to compensate for the income losses of upstream EFF farmers in highland farming areas. In addition, we found that the downstream citizens who recognize the label for EFF products and who intend to purchase EFF products in the future have a significant impact on WTPs for water quality improvement

Willingness to Pay for a Highland Agricultural Restriction Policy to Improve Water Quality in South Korea: Correcting Anomalous Preference in Contingent Valuation Method

This study examines the willingness to pay (WTP) for the highland agriculture restriction policy which aims to stabilize the water quality in the Han River basin, South Korea. To estimate the WTP, we use a double-bounded contingent valuation method and a random-effects interval-data regression. We extend contingent valuation studies by dealing with the potential preference anomalies (shift, anchoring, and inconsistent response effects). The result indicates that after the preference anomalies are corrected, the statistical precision of parameter estimates is improved. After correcting the potential preference anomalies, estimated welfare gains are on average South Korean currency (KRW) 2,861 per month per household. Based on the WTP estimate, the total benefits from the land use restriction policy are around KRW 297.73 billion and the total costs are around KRW 129.44 billion. The net benefit is, thus, around KRW 168.29 billion. This study suggests several practical solutions that would be useful for the water management. First, a priority should be given to the valid compensation for the highland farmers’ expected income loss. Second, it is necessary to increase in the unit cost of the highland purchase. Third, wasted or inefficiently used costs (e.g., overinvestment in waste treatment facilities, and temporary upstream community support) should be transferred to the program associated with high mountainous agriculture field purchase. Results of our analysis support South Korean legislators and land use policy makers with useful information for the approval and operationalization of the policy.DFG/GRK 1565/1University of BayreuthNational Research Foundation of Kore

Economic valuation of the aquatic biodiversity conservation in South Korea: Correcting for the endogeneity bias in contingent valuation

In this study, we use the Contingent Valuation (CV) method to estimate households' willingness to pay (WTP) for the aquatic ecosystem health (biodiversity) improvement. This paper extends CV studies by dealing with the endogenous effect of a proxy variable, namely the subjective experience of negative environmental quality changes. The results show that the correction for the endogeneity bias facilitates the efficiency of parameter estimation in the empirical model. The mean WTP per household accounts for around 46.8% (KRW 79.6) of the current water use charge (KRW 170 per cubic meter). The total benefit from conserving the biodiversity is around KRW 198.62 billion. We found several factors that affect households' WTP for fish biodiversity conservation, suggesting the importance of these factors in the formulation of water policies associated with aquatic biodiversity. In addition, the inefficient water management costs should be redistributed to other projects or new programs such as for the fish biodiversity conservation. © 2017 by the authors.DFG/GRK/1565/

Low Temperature Synthesis of Hexagonal Shaped α

This study demonstrates the low temperature synthesis of α-Al2O3 by solvothermal method using gibbsite alumina precursor in 1, 4-butanediol solvent according to various pH conditions. In acidic solution, an orthorhombic boehmite (AlOOH) structure was obtained after solvothermal reaction. A significant result in this study was that the solvothermally synthesized alumina in pH=9 at 300 °C for 36 h represented a rhombohedral α-Al2O3 structure hexagonal shaped with about 1.5~2.0 μm of particle size. Otherwise, the α-Al2O3 structure was rather changed to the mixture of a boehmite and α-Al2O3 structures above pH=11. In the case of α-Al2O3 synthesized at pH=9, the specific surface area was 26.18 m2/g, and the particles that were stable in acidic solution resulted in 61.80 mV of zeta potential