The “Sophistication” of Agri-food International Trade: Switching the Concept to Imports

Abstract

The aim of the paper is twofold. First, it introduces a new index (called Consy) for measuring the sophistication of traded goods looking at the importers’ side. The index is defined and then its sophistication content is assessed based on a simple regression model. Second, an empirical exercise is carried out focused on agri-food imports for a set of 46 selected items. This empirical analysis brings evidences on the kind of outcome provided by the index, but it also sheds light on recent trends in agri-food trade where demand of food imports in emerging countries is enlarging and it is more quality-oriented. Results can help stakeholders in better defining and implementing their exporting strategies, especially orienting business towards promising markets and enhancing the quality features for their exports to be delivered to more demanding consumers. Policymakers and sector analysts may also be interested in acknowledging how agri-food international trade is re-shaping in recent years in order to be able to govern the related processes.
The Consy values of agrifood products indicate that rich countries are major world importers. Furthermore, the Consy ranking shows that higher value-added and more complex items are imported mainly by richer countries. The time trend of the Consy index is also studied and results show that, in the studied period, the was an increase of import shares of food items for final consumption of higher quality from poorer countries.