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Upgrading Product Quality: The Impact of Tariffs and Standards

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  • Jihyun Eum

    (Economic Research Institute, The Bank of Korea)

Abstract

In this paper the effects of tariff reduction and enhanced standards on efforts to upgrade product quality are analyzed. Compliance costs are introduced into the model of competition and innovation where the rate of product quality upgrading is affected by both changes in tariffs and standards. Using disaggregated data for European food imports from 159 trading partners over the period 1995 to 2003 across 28 industries, it is found that the effect of lower tariffs and stricter standards on quality upgrading varies non-monotonically, whereby products that already have relatively higher quality are more likely to be upgraded but those having relatively lower quality are less likely to be upgraded.

Suggested Citation

  • Jihyun Eum, 2018. "Upgrading Product Quality: The Impact of Tariffs and Standards," Working Papers 2018-10, Economic Research Institute, Bank of Korea.
    • Handle: RePEc:bok:wpaper:1810
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    File URL: http://papers.bok.or.kr/RePEc_attach/wpaper/english/wp-2018-10.pdf
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    Cited by:

    1. Xuejun Wang & Huiying Zhou & Dongmei Su, 2022. "Does the internationalisation of China's agri‐food standards affect export quality upgrading?—Evidence from firm‐product‐level data," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 66(4), pages 887-911, October.

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    More about this item

    Keywords

    Competition; Standards; Product quality upgrading; Distance-to-frontier;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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