This paper examines the effects of aging and income subsidies on farm efficiency in Korea by utilizing the Korean Farm Household Economic Survey from 2008 to 2015. A stochastic frontier model with a non-monotonic assumption on the effect of efficiency factors is implemented to reflect a super aging and less developed production structure in Korean agriculture. This study finds continuously decreasing farm efficiency with age, which contradicts the commonly assumed inverted-U relationship between age and productivity. Especially, we find that labor is the most important factor to explain recent farm efficiency losses in Korea. Furthermore, this paper finds that the Korean income subsidy has a negative effect on farm efficiency. Our results provide two policy implications for the government of Korea. First, even though the “Returns to the Farm and Rural program” is appropriate, Korea should modify the program to encourage more young people to participate this program rather than old people, in order to attain the sustainable development of the agricultural sector. Second, a policy maker in Korea should consider a coupled subsidy that is directly related to farm production rather than a decoupled subsidy, regardless of the lower efficiency of the coupled subsidy in achieving agricultural development.

This study investigates the relationship between foreign direct investment (FDI) inflows and CO₂ emissions in Korea, applying the autoregressive distributed lag model. Specifically, we test the impact of FDI on CO₂ emissions based on Korea’s level of economic growth, using yearly data from 1971 to 2015. Our results show that, in the long run, FDI inflows positively affect CO₂ emissions. However, the absolute size of the positive effect decreases with an increase in income. Eventually, the effect of FDI inflows changes from positive to negative, increasing the GDP per capita, in the long run. Thus, while the pollution haven hypothesis is satisfied at a lower income level, the pollution halo hypothesis becomes applicable at a higher income level. For Korea, the optimal policy strategy at the current income level, is to maximize FDI inflows. Our results also imply that a policy promoting FDI inflows to developed countries, is beneficial both economically and environmentally. Meanwhile, policymakers in developing countries should adopt a balanced policy for FDI inflows, considering their negative effects on the environment and positive effects on economic growth.

This paper investigates what factors and characteristics of organic consumers affect annual organic food expenditure by using Nielsen’s consumer panel dataset from 2010 to 2014. To be specific, this paper explores new marketing opportunities by investigating organic consumer heterogeneity in different household income levels by utilizing the multilevel model. Findings in this study will contribute to the previous and existing literature in three-folds. First, we find that the organic consumers are more heterogeneous in the high-level of income groups (approximately above $60,000), as well as the low-income households between $35,000 and $45,000. This finding demonstrates that the income levels above $60,000 and around $40,000 have potential market segmentation. Second, we find that that annual organic expenditure is positively associated with consumers who consecutively repurchase organic food products compared to irregular organic consumers, supporting a different level of satisfaction. Third, we find that USDA organic labeling has a positive effect on annual organic expenditure compared to the organic labeling certified by private companies, implying the importance of credibility for the organic labeling.

In this study, we investigate important decisional factors for the purchase intention of animal welfare labeled beef in Korea considering direct and indirect paths (trust and attitudes). Using a structural equation model with 300 samples from the Korea consumer panel survey, we find that perceived knowledge and revealed information positively affect consumer purchase intention for beef labeled as supporting animal welfare. Our results also show that a subjective norm (positive opinions of friends or family on animal welfare) has a positive effect on the purchase of beef labeled as “welfare conscious.” Based on our results, we can derive policy implications for expanding animal welfare raising practices to achieve sustainable development in the livestock sector without ethical and environmental side effects. Three possible policy alternatives include an online word-of-mouth strategy for improving subjective norms, enhancing animal welfare labeling information, and setting up public education for such labeling.