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Nontariff Barriers as Bridge to Cross

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  • Munasib, Abdul B.A.
  • Roy, Devesh

Abstract

Importing country standards emerge as an effective trade barrier when they exceed those of the exporting country’s domestic market. We introduce a new concept: bridge to cross (BTC), the regulatory gap between the exporting and importing countries. Importer regulations cannot be identified in a gravity model when multilateral resistance is correctly accounted for with exporter-time and importer-time fixed-effects. BTC, however, can be identified because it varies over time and by trading pair. As an application we apply the method to an SPS regulation regarding Aflatoxin contamination in maize. We find that the effect of BTC is higher for poorer countries.

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Paper provided by International Association of Agricultural Economists in its series 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil with number 125025.

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Date of creation: Jan 2011
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Handle: RePEc:ags:iaae12:125025

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Keywords: Nontariff barrier; sanitary and phytosanitary standards (SPS); gravity model; multilateral resistance; bridge to cross; Agricultural and Food Policy; Food Consumption/Nutrition/Food Safety; Health Economics and Policy; International Development; International Relations/Trade; Research Methods/ Statistical Methods; F13; F14; Q17;

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  1. Novy, Dennis, 2006. "Trade Costs and the Open Macroeconomy," The Warwick Economics Research Paper Series (TWERPS) 778, University of Warwick, Department of Economics.
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  12. Otsuki, Tsunehiro & Wilson, John S. & Sewadeh, Mirvat, 2001. "Saving two in a billion: : quantifying the trade effect of European food safety standards on African exports," Food Policy, Elsevier, vol. 26(5), pages 495-514, October.
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