Implications of food safety and quality standards: Insights from Turkish tomato exports

Global trade system is witnessing an unprecedented increase in food safety and quality standards. Changes in the structure of the world trade affect the welfare of farmers and consumers, destinations of exports, and the dynamics behind the exporters' compliance decisions with these non-tariff barriers to trade. This dissertation consists of three related essays.;In the first essay, a partial equilibrium model of tomato trade from Turkey to European Union countries is developed to examine the combined effects of quality and safety standards and price-dependent barriers to trade such as minimum import prices for imports. This essay also incorporates the heterogeneous preference structure of consumers in the EU, i.e., consumers are distinguished by their concern over the potential negative effects of their consumption of tomatoes. The results indicate that minimum entry price enforcement has a positive effect on producer welfare in the importing country, and negative effect on consumer welfare in the importing country and producer welfare in the exporting country if applied with non-tariff barriers.;In the second essay, a Markov Chain Analysis is used to examine changes in the destination markets of the Turkish tomato exports and whether these can be linked to trade standards. A Markov probability transition matrix is estimated and suggests that transition probabilities are higher from high standard to medium and low standard countries. On the other hand, there is almost zero probability of transition from low and medium standard groups to the high standard group in terms of food safety and quality.;In the third essay, exporters' decision on whether or not to comply with an importer's requirements is examined by focusing on a representative Turkish tomato exporter's decision problem in two different markets in terms of their enforcements of the safety and quality requirements: the EU and Russia. Two dynamic decision models are developed for two different markets. In the EU market, the exporter faces a discrete choice of either complying or non-complying with the existing standards; hence, a discrete model of compliance is used. In the Russian market, the application of standards is such that the exporter can choose the level of compliance, hence, a continuous model of compliance is used. Results suggest that Turkish tomato exporters who focus on EU markets are likely to be more cautious in terms of compliance than the ones who send their produce to the Russian Federation.