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Used automobile protection and trade: Gravity and ordered probit analysis

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Author Info
Danilo Pelletiere ()
Kenneth A. Reinert ()

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Abstract

There is a great deal of protection against used automobile imports in many countries of the world that has gone largely unnoticed in the trade policy literature. Indeed, there has been no recent attempt to systematically analyze the determinants of used automobile trade and the role of protection in this trade. This paper makes a preliminary attempt, introducing an ordered measure of protection levels in 132 countries. A gravity model of used automobile exports from the United States shows that protection measures against used automobile import have a statistically-significant, suppressive effect on trade flows. An ordered probit analysis of the protection measures themselves points to new automobile production interests as a key factor behind used automobile protection. Other relevant explanatory factors of protection are income levels, democratic regime, transitional status, WTO membership, and income distribution. Copyright Springer-Verlag 2004

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File URL: http://hdl.handle.net/10.1007/s00181-004-0216-6
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Publisher Info
Article provided by Springer in its journal Empirical Economics.

Volume (Year): 29 (2004)
Issue (Month): 4 (December)
Pages: 737-751
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Handle: RePEc:spr:empeco:v:29:y:2004:i:4:p:737-751

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Related research
Keywords: Used goods; international trade; gravity model; ordered probit; F13; F17; C20; C25;

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  1. Sofronis Clerides, 2004. "Gains from Trade in Used Goods: Evidence from the Global Market for Automobiles," University of Cyprus Working Papers in Economics 6-2004, University of Cyprus Department of Economics. [Downloadable!]
    Other versions:
  2. BERTINELLI, Luisito & STROBL, Eric & ZOU, Benteng, 2006. "Polluting technologies and sustainable economic development," CORE Discussion Papers 2006052, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE). [Downloadable!]
    Other versions:
  3. Lucas W. Davis & Matthew E. Kahn, 2008. "International Trade in Used Durable Goods: The Environmental Consequences of NAFTA," NBER Working Papers 14565, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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