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International Trade in Natural Resources: Practice and Policy

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Author Info

  • Michele Ruta

    (Economic Research Division, World Trade Organization, Geneva 21, CH-1211, Switzerland)

  • Anthony J. Venables

    ()
    (Department of Economics, University of Oxford, Oxford, OX1 3UQ, United Kingdom)

Abstract

Natural resources account for 20% of world trade and dominate the exports of many countries. Policy is used to manipulate both international and domestic prices of resources, yet policy is largely outside the disciplines of the WTO. The instruments used include export taxes, price controls, production quotas, and domestic producer and consumer taxes (equivalent to trade taxes if no domestic production is possible). We review the literature and argue that the policy equilibrium is inefficient. This inefficiency is exacerbated by market failure in long-run contracts for the exploration and development of natural resources. Properly coordinated policy reforms offer an avenue to resource-exporting and resource-importing countries to overcome these inefficiencies and to obtain mutual gains.

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Bibliographic Info

Article provided by Annual Reviews in its journal Annual Review of Resource Economics.

Volume (Year): 4 (2012)
Issue (Month): 1 (08)
Pages: 331-352

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Handle: RePEc:anr:reseco:v:4:y:2012:p:331-352

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Related research

Keywords: trade; export tax; tariff escalation; OPEC; WTO; terms of trade;

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References

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Citations

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Cited by:
  1. Wübbeke, Jost, 2013. "Rare earth elements in China: Policies and narratives of reinventing an industry," Resources Policy, Elsevier, vol. 38(3), pages 384-394.
  2. Sergey Mityakov & Heiwai Tang & Kevin K. Tsui, 2012. "InternationalPolitics and Import Diversification in the Second Wave of Globalization," Discussion Papers Series, Department of Economics, Tufts University 0770, Department of Economics, Tufts University.
  3. Dülger, Fikret & Lopcu, Kenan & Burgaç, Almıla & Ballı, Esra, 2013. "Is Russia suffering from Dutch Disease? Cointegration with structural break," Resources Policy, Elsevier, vol. 38(4), pages 605-612.

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