Analysis of the Effect of FTA on Shrimp Market in Korea

This research study aims to analyze the effect of FTA on shrimp market in Korea. Korea has been actively engaged in the World trade, especially after signing FTAs. While expecting efficient allocation of resources and economic development, it has become harder to predict the certainty of price changes. Among the industries, shrimp has been the most traded marine product and impacts greatly not only in fishery industries but also in consumers’ needs. This study reveals how three most representative FTAs affects the price level of shrimps, and thus the overall shrimp market in Korea. Connecting the research of the relationship between FTA and price fluctuation and the consumer trends, this study provides the reciprocal relationship of the elements. The research clearly shows that after settling the FTAs, the price level decreases and eventually leads to increase in demand, as the results of change in shrimp sales in the largest wholesale mart in Korea and change in shrimp import amount shows. This study concludes that FTA has a positive effect on shrimp market in Korea, increasing the supply and demand of shrimps and enlarging the market itself.