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International standards and international trade: Empirical evidence from ISO 9000 diffusion

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  • Clougherty, Joseph A.
  • Grajek, Michał

Abstract

Empirical scholarship on the standards–trade relationship has been held up due to methodological challenges: measurement, varied effects, and endogeneity. Considering the trade-effects of one particular standard (ISO 9000), we surmount methodological challenges by measuring standardization via national penetration of ISO 9000, allowing standardization to manifest via multiple (quality-signaling, information/compliance-cost, and common-language) channels, and using instrumental variable, multilateral resistance and panel data techniques to overcome endogeneity. We find evidence of common-language and quality-signaling augmenting country-pair trade. Yet, ISO-rich nations benefit the most from standardization, while ISO-poor nations find ISO 9000 to represent a trade barrier due to compliance-cost effects.

Suggested Citation

  • Clougherty, Joseph A. & Grajek, Michał, 2014. "International standards and international trade: Empirical evidence from ISO 9000 diffusion," International Journal of Industrial Organization, Elsevier, vol. 36(C), pages 70-82.
    • Handle: RePEc:eee:indorg:v:36:y:2014:i:c:p:70-82
    DOI: 10.1016/j.ijindorg.2013.07.005
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    3. Hezekiah Agwara & Philip Auerswald & Brian Higginbotham, 2014. "Algorithms and the Changing Frontier," NBER Working Papers 20039, National Bureau of Economic Research, Inc.
    4. Drori, Netanel & Hashai, Niron & Clougherty, Joseph A., 2023. "Fire and ice: The incompatible impact of industry-wide domestic patents and international standards on firm internationalization," International Business Review, Elsevier, vol. 32(5).
    5. Victoria Golikova & Boris Kuznetsov, 2014. "Do Russian Firms Need ISO Certification for Exporting?," ERSA conference papers ersa14p1721, European Regional Science Association.
    6. Keith E. Maskus & Tsunehiro Otsuki & John S. Wilson, 2013. "Do foreign product standards matter? Impacts on costs for developing country exporters," Asia-Pacific Journal of Accounting & Economics, Taylor & Francis Journals, vol. 20(1), pages 37-57, March.
    7. Blind, Knut & Mangelsdorf, Axel & Pohlisch, Jakob, 2018. "The effects of cooperation in accreditation on international trade: Empirical evidence on ISO 9000 certifications," International Journal of Production Economics, Elsevier, vol. 198(C), pages 50-59.
    8. Joseph A. Clougherty, & Michał Grajek, & Oz Shy, 2016. "Taking ‘some’ of the mimicry out of the adoption process: Quality management and strategic substitution," ESMT Research Working Papers ESMT-16-05, ESMT European School of Management and Technology.
    9. Olivier CADOT & Patricia AUGIER & Marion DOVIS, 2016. "Regulatory harmonization, profits, and productivity: Firm-level evidence from Morocco," Working Papers P162, FERDI.
    10. Clougherty, Joseph A. & Grajek, Michał, 2023. "Decertification in quality-management standards by incrementally and radically innovative organizations," Research Policy, Elsevier, vol. 52(1).
    11. Clougherty, Joseph A. & Grajek, Michal & Shy, Oz, 2016. "Taking ‘Some’ of the Mimicry Out of the Adoption Process: Quality-Management and Strategic Substitution," CEPR Discussion Papers 11661, C.E.P.R. Discussion Papers.
    12. Calza, Elisa & Goedhuys, Micheline, 2018. "Domestic quality certification and growth of Vietnamese MSMEs," MERIT Working Papers 2018-026, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    13. Nathalia Granja & Pedro Domingues & Mónica Cabecinhas & Dominik Zimon & Paulo Sampaio, 2021. "ISO 22000 Certification: Diffusion in Europe," Resources, MDPI, vol. 10(10), pages 1-16, September.
    14. Yujuan Guo & Abe P. L. Jong & Andy C. L. Yeung, 2018. "Quality management and international trade: institutionalization of quality standards and performance outcomes in China," Journal of Shipping and Trade, Springer, vol. 3(1), pages 1-10, December.
    15. Ni, Shiying & Bai, Xiwen & Li, Lefei, 2022. "Behind the heterogeneous trade effects of standards: Multi-sector evidence from China," Journal of Asian Economics, Elsevier, vol. 82(C).
    16. Hezekiah Agwara & Philip Auerswald & Brian Higginbotham, 2013. "Algorithms and the Changing Frontier," NBER Chapters, in: The Changing Frontier: Rethinking Science and Innovation Policy, pages 371-410, National Bureau of Economic Research, Inc.
    17. Abdoul G. Sam & Danbee Song, 2022. "Corporate environmentalism and international trade: Evidence from industry‐level data," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 29(5), pages 1440-1455, September.
    18. Knut Blind & Maximilian Laer, 2022. "Paving the path: drivers of standardization participation at ISO," The Journal of Technology Transfer, Springer, vol. 47(4), pages 1115-1134, August.
    19. Hottenrott, Moritz & Thorwarth, Susanne & Wey, Christian, 2016. "Gegenstandsbereiche der Normung," DICE Ordnungspolitische Perspektiven 83, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    20. Sungida Rashid, 2021. "Do manufacturing firms in Bangladesh acquire ISO certificates to offset the handicap of credit constraints?," SN Business & Economics, Springer, vol. 1(1), pages 1-15, January.

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    More about this item

    Keywords

    International trade; Standards; Technical trade barriers; ISO 9000; Networks;
    All these keywords.

    JEL classification:

    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation

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