Trade diversion risk for halal food exports

Kabir, Shahriar and Shams, Syed and Lawrey, Roger (2020) Trade diversion risk for halal food exports. Journal of Islamic Marketing. pp. 1-25. ISSN 1759-0833


Abstract

Purpose – The purpose of this paper is to investigate the link between trade diversion risk and new Halal market exploration.
Design/methodology/approach – This paper analyzes the Halal trade flows for Malaysia’s top 11 halal food/food related commodities from 1967 to 2018 by relying on co-integration and auto-regression techniques.
Findings – This paper determines that the greater the country’s current comparative advantage in an exported good, the higher the risk of export diversion between the Halal and conventional markets. The diversion risk, however, disappears with a lower current comparative advantage.
Practical implications – To take advantage of the fast emerging Halal market, a country should expand export of commodities with relatively low current comparative advantage but high demand in the target market, along with supportive trade policies to build competitiveness in the long term.
Originality/value – This study fills the gap in the literature by investigating if the theory of comparative advantage can predict the market diversification risk that may arise from the expansion of exports to the Halal market occurring alongside existing exports to the conventional market


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Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Faculty/School / Institute/Centre: Historic - Faculty of Business, Education, Law and Arts - School of Commerce (1 Jul 2013 - 17 Jan 2021)
Faculty/School / Institute/Centre: Historic - Faculty of Business, Education, Law and Arts - School of Commerce (1 Jul 2013 - 17 Jan 2021)
Date Deposited: 22 Jul 2020 05:08
Last Modified: 27 Jul 2020 02:10
Uncontrolled Keywords: Malaysia; Trade diversion; Halal market; Comparative advantage; Food export
Fields of Research (2008): 15 Commerce, Management, Tourism and Services > 1502 Banking, Finance and Investment > 150201 Finance
Identification Number or DOI: https://doi.org/10.1108/JIMA-07-2019-0145
URI: http://eprints.usq.edu.au/id/eprint/38873

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