Comparing the economics welfare on leading rice exports countries based on copula SEM: The case of India, Thailand, and Vietnam

Abstract

This paper aims to investigate economics welfare gain from main rice export countries, namely India, Thailand, and Vietnam, by measuring the demand and supply of exporters and importers estimated by the copula-based Simultaneous ECM Approach. This model exploits a benefit of copula functions which allow the error's distribution of both demand and supply equations to have more realistic distributions. The highlighted empirical results show the adjustment of importing countries to the equilibrium. Thai rice export market can adjust better than the other two countries. This means that the export market is very strong. In the supply side, India is the fastest country in adjusting to its equilibrium. For the economic welfare aspect, the most welfare benefits in Thai rice trade belong to importing countries. Whereas, the most welfare benefits in India rice trade belong to exporting countries.