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Small flows, compliance costs and trade preferences: The case of EU imports from African LDCs

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  • Nilsson, Lars
  • Dotter, Caroline

Abstract

Previous work has shown that a significant number of preference eligible goods are imported into the EU from developing countries at relatively small values and that the rate of preference utilisation of these imports are low and in many cases zero. This fact is unobserved in the aggregate figures because large flows have high utilisation rates, thereby pushing up the average preference utilisation rate. This paper examines this phenomenon further by using monthly data on EU imports from African LDCs at the lowest level of (publicly) available aggregation thereby coming close to transaction level data. It identifies the average value of preference eligible imports, utilising and not utilising preferences, by country and product category and test their empirical relevance for explaining the African LDCs' preference utilisation rates.

Suggested Citation

  • Nilsson, Lars & Dotter, Caroline, 2012. "Small flows, compliance costs and trade preferences: The case of EU imports from African LDCs," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 6, pages 1-29.
    • Handle: RePEc:zbw:ifweej:201245
    DOI: 10.5018/economics-ejournal.ja.2012-45
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    References listed on IDEAS

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    1. Paul Brenton & Miriam Manchin, 2014. "Making EU Trade Agreements Work: The Role of Rules of Origin," World Scientific Book Chapters, in: INTERNATIONAL TRADE, DISTRIBUTION AND DEVELOPMENT Empirical Studies of Trade Policies, chapter 14, pages 299-313, World Scientific Publishing Co. Pte. Ltd..
    2. Yves Bourdet & Joakim Gullstrand & Karin Olofsdotter (ed.), 2007. "The European Union and Developing Countries," Books, Edward Elgar Publishing, number 3731.
    3. Joseph Francois & Bernard Hoekman & Miriam Manchin, 2006. "Preference Erosion and Multilateral Trade Liberalization," The World Bank Economic Review, World Bank, vol. 20(2), pages 197-216.
    4. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521766555, January.
    5. Persson, Maria & Wilhelmsson, Fredrik, 2006. "Assessing the Effects of EU Trade Preferences for Developing Countries," Working Papers 2006:4, Lund University, Department of Economics, revised 26 Jun 2006.
    6. Miriam Manchin, 2006. "Preference Utilisation and Tariff Reduction in EU Imports from ACP Countries," The World Economy, Wiley Blackwell, vol. 29(9), pages 1243-1266, September.
    7. Lars Nilsson, 2011. "Small Trade Flows And Preference Utilisation: The Case Of The European Union," South African Journal of Economics, Economic Society of South Africa, vol. 79(4), pages 392-410, December.
    8. Mariarosaria Agostino & Federica Demaria & Francesco Trivieri, 2010. "Non‐Reciprocal Trade Preferences and the Role of Compliance Costs in the Agricultural Sector: Exports to the EU," Journal of Agricultural Economics, Wiley Blackwell, vol. 61(3), pages 652-679, September.
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    Cited by:

    1. Katerina Gradeva & Inmaculada Martínez-Zarzoso, 2016. "Are Trade Preferences more Effective than Aid in Supporting Exports? Evidence from the ‘Everything But Arms’ Preference Scheme," The World Economy, Wiley Blackwell, vol. 39(8), pages 1146-1171, August.
    2. Kuo‐I Chang & Kazunobu Hayakawa & Nuttawut Laksanapanyakul & Dionisius Narjoko & Ju Hyun Pyun & Francis Quimba, 2022. "Determinants of regional trade agreement utilisation: Evidence from multiple import countries in Asia," The World Economy, Wiley Blackwell, vol. 45(6), pages 1713-1736, June.
    3. Elwyn Davies & Lars Nilsson, 2020. "A comparative analysis of EU and US trade policies towards least developed countries and the African Growth and Opportunity Act beneficiaries," Development Policy Review, Overseas Development Institute, vol. 38(5), pages 613-629, September.

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    More about this item

    Keywords

    trade preferences; preference utilisation; small trade flows; compliance costs; LDCs;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration

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