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Trade Facilitation and Economic Development: A New Approach to Quantifying the Impact

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Author Info

  • John S. Wilson
  • Catherine L. Mann
  • Tsunehiro Otsuki

Abstract

This article analyzes the relationship between trade facilitation and trade flows in the Asia-Pacific region. Country-specific data for port efficiency, customs environment, regulatory environment, and e-business usage are used to construct indicators for measuring trade facilitation. The relationship between these indicators and trade flows is estimated using a gravity model that includes tariffs and other standard variables. Enhanced port efficiency has a large and positive effect on trade flows. Regulatory barriers deter trade. Improvements in customs and greater e-business use significantly expand trade but to a lesser degree than improvements in ports or regulations. The benefits of specific trade facilitation efforts are estimated by quantifying differential improvements in these four areas among members of the Asia Pacific Economic Cooperation ( apec ). A scenario in which apec members with below-average indicators improve capacity halfway to the average for all members shows that intra- apec trade could increase by $254 billion, or 21 percent of intra- apec trade flows. About half the increase is derived from improved port efficiency. Copyright 2003, Oxford University Press.

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Bibliographic Info

Article provided by World Bank Group in its journal The World Bank Economic Review.

Volume (Year): 17 (2003)
Issue (Month): 3 (December)
Pages: 367-389

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Handle: RePEc:oup:wbecrv:v:17:y:2003:i:3:p:367-389

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Citations

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Cited by:
  1. Prabir De & Abdur Rob Khan & Sachin Chaturvedi, 2008. "Transit and Trade Barriers in Eastern South Asia: A Review of the Transit Regime and Performance of Strategic Border-Crossings," Working Papers 5608, Asia-Pacific Research and Training Network on Trade (ARTNeT), an initiative of UNESCAP and IDRC, Canada..
  2. Seker, Murat, 2011. "Trade policies, investment climate, and exports across countries," Policy Research Working Paper Series 5654, The World Bank.
  3. Bourdet, Yves & Persson, Maria, 2011. "Reaping the Benefits of Deeper Euro-Med Integration Through Trade Facilitation," Working Papers 2011:15, Lund University, Department of Economics.
  4. Persson, Maria, 2010. "Trade Facilitation and the Extensive Margin," Working Paper Series 828, Research Institute of Industrial Economics.
  5. Richard Pomfret & Patricia Sourdin, 2010. "Why do trade costs vary?," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 146(4), pages 709-730, December.
  6. Inma Martinez-Zarzoso & Laura Márquez-Ramos, 2008. "The Effect of Trade Facilitation on Sectoral Trade," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 8(1), pages 42.
  7. Yann Duval, 2008. "Trade Facilitation beyond the Doha round of negotiations," STUDIES IN TRADE AND INVESTMENT, in: Trade Facilitation Beyond the Multilateral Trade Negotiations: Regional Practices, Customs, Valuation and Other Emerging Issues, pages 1-25 United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
  8. Bruce A. Blonigen & Wesley Wilson, 2006. "New Measures of Port Efficiency Using International Trade Data," NBER Working Papers 12052, National Bureau of Economic Research, Inc.
  9. Márquez-Ramos, Laura & Martínez-Zarzoso, Inmaculada & Suárez-Burguet, Celestino, 2012. "Trade policy versus trade facilitation: An application using good old OLS," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 6(11), pages 1-38.
  10. Persson, Maria, 2007. "Trade Facilitation and the EU-ACP Economic Partnership Agreements: Who Has the Most to Gain?," Working Papers 2007:8, Lund University, Department of Economics, revised 01 Oct 2007.
  11. Lai, Yu-Bong & Hu, Chia-Hsien, 2008. "Trade agreements, domestic environmental regulation, and transboundary pollution," Resource and Energy Economics, Elsevier, vol. 30(2), pages 209-228, May.
  12. Ahmed, Saira & Ahmed, Vaqar & Sohail, Safdar, 2010. "Trade agreements between developing countries: a case study of Pakistan - Sri Lanka free trade agreement," MPRA Paper 29209, University Library of Munich, Germany.
  13. Itzhak Goldberg & Lee Branstetter & John Gabriel Goddard & Smita Kuriakose, 2008. "Globalization and Ttechnology Absorption in Europe and Central Asia : The Role of Trade, FDI, and Cross-Border Knowledge Flows," World Bank Publications, The World Bank, number 6445, 5.
  14. Luljeta Hajderllari & Kostas Karantininis & Lartey G. Lawson, 2012. "FDI as an Export-Platform: A Gravity Model for the Danish Agri-Food Industry," IFRO Working Paper 2012/7, University of Copenhagen, Department of Food and Resource Economics.
  15. Königer, Jens & Busse, Matthias & Hoekstra, Ruth, 2011. "The Impact of Aid for Trade Facilitation on the Costs of Trading," Proceedings of the German Development Economics Conference, Berlin 2011 48, Verein für Socialpolitik, Research Committee Development Economics.
  16. repec:ebl:ecbull:v:17:y:2004:i:5:p:1-9 is not listed on IDEAS
  17. Christopher Findlay, 2009. "Trade Facilitation in the ASEAN Economic Community," Working Papers PB-2009-06, Economic Research Institute for ASEAN and East Asia (ERIA).
  18. Itzhak Goldberg & John Gabriel Goddard & Smita Kuriakose & Jean-Louis Racine, 2011. "Igniting Innovation : Rethinking the Role of Government in Emerging Europe and Central Asia," World Bank Publications, The World Bank, number 2358, 5.
  19. Persson, Maria, 2008. "Trade Facilitation and the Extensive and Intensive Margins of Trade," Working Papers 2008:13, Lund University, Department of Economics.

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