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The trade policy effect in international trade: case of Pakistan

Author

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  • Alassane D. Yeo

    (Hunan University
    Hunan University)

  • Aimin Deng

    (Hunan University
    Hunan University)

Abstract

The debate on free trade and protectionism is ravaging in recent years. The industrialized countries are losing more and more market to the benefit of emerging countries. Liberals worry about new tariff barriers, while protectionists fear that unevenly distributed losses and gains will lead to significant economic dislocation of workers in import-competing industries. The economic policy of restricting imports and the economic policy of opening exports remain two critical measures of international trade. This study uses the gravity model to investigate the impacts of trade policy measures on trade flows between Pakistan and its dominant trading pattern for the period 2006 to 2015. The findings revealed the statistically significant correlation of trade policy variables on exports and imports. The study extended the analysis by examining four specificities groups of trade policy and continuing the analysis by estimating different country groups according to geographical or organizational clusters. The findings indicated that the specificities of trade policy have a statistically significant effect on exports and imports. Moreover, the signs of the coefficients are opposite in both models. The main political implication is that the proliferation of free trade agreements can have a positive impact on international trade.

Suggested Citation

  • Alassane D. Yeo & Aimin Deng, 2019. "The trade policy effect in international trade: case of Pakistan," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 8(1), pages 1-17, December.
    • Handle: RePEc:spr:jecstr:v:8:y:2019:i:1:d:10.1186_s40008-019-0169-8
    DOI: 10.1186/s40008-019-0169-8
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    Cited by:

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    2. Sharma, Rajesh & Sinha, Avik & Kautish, Pradeep, 2021. "Does financial development reinforce environmental footprints? Evidence from emerging Asian countries," MPRA Paper 108161, University Library of Munich, Germany, revised 2021.
    3. Essotanam Mamba & Afi Balaki, 2022. "Effects of trade policies on external trade performances of ECOWAS countries (1996–2017)†," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 30(3), pages 535-566, July.
    4. Imad Kareem Alaamshani & Hanny Zurina Hamzah & Shivee Ranjanee Kaliappan & Normaz Wana Ismail, 2021. "Impact of Trade Facilitation on Extensive Margin," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 4, pages 131-147.

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