What explains rice exports? an analysis of major rice-exporting countries

Abstract

This study examines the drivers of rice trade. The analysis uses the standard comparative advantage model, the Heckscher-Ohlin-Vanek (HOV) framework, supplemented with a gravity-type equation. Using the Poisson pseudo-maximum likelihood (PPML) estimation for data from 2002 to 2020, the analysis broadly confirms HOV model predictions. Results indicate that arable land, along with GDP, distance, precipitation and crop season temperature, significantly influences rice trade dynamics. The results showed that the precipitation play a key role in influencing the rice trade rather than the blue water availability. However, agricultural water stress discouraged exports and encouraged imports.