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From Bound Duties to Actual Protection: Industrial Liberalisation in the Doha Round

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Abstract

In the background of the Doha Round of trade negotiations, this study proposes a CGE assessment of multilateral liberalisation of market access for non-agricultural products. The scenarios considered include the so-called ‘Girard proposal’ (with alternative choices for the coefficient involved), the removal of tariff peaks and complete liberalisation. This study is the first to take into account the difference between bound and applied tariffs, while considering all the enforced preferential trade arrangements and computing tariff cuts at the detailed product level (HS-6 classification). Although the liberalisation of market access for non-agricultural products is found to be welfare-enhancing at the world level, cross-country distributive effects prove significant. A soft liberalisation would not significantly reduce applied duties in developing countries, owing to their considerable binding overhang. By contrast, a deep liberalisation would entail fierce price competition among those developing countries that are largely specialised in similar sectors and in the same product quality range.

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Bibliographic Info

Paper provided by European Network of Economic Policy Research Institutes in its series Economics Working Papers with number 041.

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Length: 51 pages
Date of creation: Nov 2005
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Handle: RePEc:epr:enepwp:041

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Keywords: Doha development agenda; applied tariffs; preferential trade agreements; binding overhang; computable general equilibrium model;

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References

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  1. Lionel Fontagné & Thierry Mayer & Soledad Zignago, 2005. "Trade in the Triad: how easy is the access to large markets?," Canadian Journal of Economics, Canadian Economics Association, vol. 38(4), pages 1401-1430, November.
  2. Agnès Bénassy-Quéré & Amina Lahrèche-Revil & Lionel Fontagné, 2003. "Tax Competition and Foreign Direct Investment," Working Papers 2003-17, CEPII research center.
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Cited by:
  1. Bou�t, Antoine, 2006. "What can the poor expect from trade liberalization?: opening the "black box" of trade modeling," MTID discussion papers 93, International Food Policy Research Institute (IFPRI).
  2. Mohamed Hedi Bchir & Sébastien Jean & David Laborde, 2006. "Binding Overhang and Tariff-Cutting Formulas," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 142(2), pages 207-232, July.
  3. Butt, Muhammad Shoaib & Bandara, Jayatilleke S., 2008. "National and Regional Impacts of Increasing Non-Agricultural Market Access by Developing Countries – the Case of Pakistan," Economic Analysis and Policy (EAP), Queensland University of Technology (QUT), School of Economics and Finance, vol. 38(2), pages 277-311, September.
  4. Goldbaum, Sergio & Coelho, Allexandro Mori & Lima, Maria Lúcia L. M. Pádua & Cury, Samir, 2006. "Impacts of the Proposals For Tariff Reductions in Non-Agricultural Market Access (Nama)," Textos para discussão 155, Escola de Economia de São Paulo, Getulio Vargas Foundation (Brazil).
  5. Jayatilleke S. Bandara, 2007. "The Effects of Agricultural Trade Liberalisation under the Doha Development Agenda with Special Reference to the Asia Pacific Region: A Brief Survey," Working Papers 3107, Asia-Pacific Research and Training Network on Trade (ARTNeT), an initiative of UNESCAP and IDRC, Canada..

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