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Impact of European food safety border inspections on agri-food exports: Evidence from Chinese firms

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  • Beestermöller, Matthias
  • Disdier, Anne-Célia
  • Fontagné, Lionel

Abstract

The cost of complying with a sanitary standard is certain. However, such measure introduces uncertainty for exporters in relation to border rejections. Shipments may fail to pass inspections and may be refused entry into the importing country. This risk is shaped by variance in the quality of the exported product, and the stringency of the border controls. We examine how the risk of rejection at European borders on safety grounds is affecting Chinese agri-food exporters. We combine information from the European Rapid Alert System for Food and Feed with Chinese firm-level export data by product, destination and year for the period 2000–2011. Information externalities and reputation effects are important. Border rejections amplify the turnover among firms at the extensive margin of trade. This risk is curbing small exporters and resulting in a concentration of Chinese exports among big exporters.

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  • Beestermöller, Matthias & Disdier, Anne-Célia & Fontagné, Lionel, 2018. "Impact of European food safety border inspections on agri-food exports: Evidence from Chinese firms," China Economic Review, Elsevier, vol. 48(C), pages 66-82.
    • Handle: RePEc:eee:chieco:v:48:y:2018:i:c:p:66-82
    DOI: 10.1016/j.chieco.2017.11.004
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    9. Fiankor, Dela-Dem Doe & Ehrich, Malte & Brümmer, Bernhard, 2016. "EU-African Regional Trade Agreements as a Development Tool to Reduce EU Border Rejections," GlobalFood Discussion Papers 244352, Georg-August-Universitaet Goettingen, GlobalFood, Department of Agricultural Economics and Rural Development.
    10. Kathy Baylis & Lia Nogueira & Linlin Fan & Kathryn Pace, 2022. "Something fishy in seafood trade? The relation between tariff and non‐tariff barriers," American Journal of Agricultural Economics, John Wiley & Sons, vol. 104(5), pages 1656-1678, October.
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    12. Mao, Rui & Liu, Yuhang & Wang, Xiaoxi, 2023. "Economic and environmental impacts of agricultural non-tariff measures: evidence based on ad valorem equivalent estimates," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 26(3), January.
    13. Jason A. Winfree, 2023. "Collective reputation and food," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 45(2), pages 666-683, June.
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    15. Grundke, Robert & Moser, Christoph, 2019. "Hidden protectionism? Evidence from non-tariff barriers to trade in the United States," Journal of International Economics, Elsevier, vol. 117(C), pages 143-157.
    16. Traoré, Ousmane Z & Tamini, Lota D., 2020. "The Net Effect of the Technical Non-Tariff Measures in OECD countries on African Exports of Plant Products," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304460, Agricultural and Applied Economics Association.
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    19. Jie Ma & Rong Cai & Weifu Zhang, 2023. "Has the Decline in Trade Policy Uncertainty Promoted China’s Agricultural Exports?," Sustainability, MDPI, vol. 15(14), pages 1-14, July.
    20. Li, Haoran & Wan, Xibo & Zhang, Wendong, 2021. "How do Firms Respond to Long-term Political Tensions? Evidence from Chinese Food Importers," ISU General Staff Papers 202106020700001118, Iowa State University, Department of Economics.

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    More about this item

    Keywords

    Food safety; Border inspections; Import refusals; Uncertainty; Firm heterogeneity;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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