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Market Structure and Market Access

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  • Joseph Francois
  • Ian Wooton

Abstract

We examine the interaction between goods trade and market power in domestic trade and distribution sectors. Theory suggests a set of linkages between service-sector competition and goods trade supported by econometrics involving imports of 22 OECD countries vis-à-vis 69 exporters. Competition in services affects the volume of goods trade while the market structure of the domestic service sector becomes increasingly important as tariffs are reduced. Empirically, lack of service competition apparently matters most for exporters in smaller, poorer countries. By ignoring the structure of the domestic services sector, we may be seriously overestimating the market-access benefits of tariff reductions.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2008/wp-cesifo-2008-03/cesifo1_wp2239.pdf
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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2239.

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Date of creation: 2008
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Handle: RePEc:ces:ceswps:_2239

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Keywords: import volumes; distribution section; market access; services; trade liberalisation; GATS; gravity model;

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