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Abstract
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The purpose of this paper is to predict the impacts of GATT Agreement on Agriculture with respect to supply-demand, stock, and consumer's price of Korean Rice. For this aim I developed a Supply-Demand Model of Rice which consists of eight structural equations used and estimated the time series data from 1970 to 1998 and eight definition formulas. In order to conduct simulations, I think two factor, the change of political sector variables such as the government intervention price (purchasing or offering price) or quantity and market opening variables such as the amount of the Minimum Market Access or the Tariffication. From the simulation, it is clear that the continual raising of the government-purchasing price is a necessary condition in order to achieve self-sufficiency. And the key of decision is amount of the stock when is faced to the choice problem of the special treatment or the tariffication. The notable simulation results are as follows: (1) Self-sufficiency is achieved by raising a government-purchasing price. (2) However this political process result in increasing the stock. The problem of the surplus stock becomes more serious when the government chooses the continuation of special treatment so that the Minimum Market Access is expanded. In the worst case, the amount of stock reaches up to 72.4% of domestic consumption. (3) When accepting tariffication, the problem of the stock surplus is mitigated. The amount of stock becomes 15% of the domestic consumption. (4) When accepting tariffication, the rate of self-sufficiency comes down to 77.4%. But the difference between the cases to choose the continuation of special treatment is only 1.6%. (5) If accepting tariffication, the tariff rate is reduced to 75% for 6-years, the amount imported additionally is 771,500ton, 15.3% of the domestic consumption at the maximum.
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