This paper is concerned with rules of origin when intermediate goods are differentiated. An analytical model emphasizes trade patterns and the relative importance of trade in intermediates given trade preferences. Econometric evidence based on intra-OECD trade in motor vehicles and motor vehicle parts points to a systematic impact of trade costs and FTA membership, following from rules of origin and reduction in border measures, on the role of intermediates and their relative importance in production and trade. These results are consistent with a conceptual framework involving rules-base trade costs and two-way trade in differentiated intermediate goods and final goods.
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Find related papers by JEL classification: F15 - International Economics - - Trade - - - Economic Integration F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
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Joseph F. Francois & Douglas Nelson, 2002.
"A Geometry Of Specialisation,"
Economic Journal,
Royal Economic Society, vol. 112(481), pages 649-678, July.
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