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Trade Restrictiveness Indices in Presence of Externalities : An Application to Non-Tariff Measures

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Author Info

  • John Christopher Beghin

    (Iowa State University - Iowa State University)

  • Anne-Célia Disdier

    (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - École des Hautes Études en Sciences Sociales (EHESS) - École des Ponts ParisTech (ENPC) - École normale supérieure [ENS] - Paris - Institut national de la recherche agronomique (INRA), EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris)

  • Stéphan Marette

    (ECO-PUB - Economie Publique - Institut national de la recherche agronomique (INRA) : UMR0210 - AgroParisTech)

Abstract

We extend the trade restrictiveness index approach to the case of market imperfections and domestic regulations addressing them. We focus on standard-like non-tariff measures (NTMs) affecting cost of production and potentially enhancing demand by increasing product quality or reducing negative externalities. We apply the framework to the database of Kee et al. (2009) and derive ad valorem equivalents (AVEs) for NTMs. Half of the product lines affected by NTMs exhibit negative AVEs, indicating a net trade-facilitating effect of NTMs. Accounting for these effects significantly reduces previous measures of countries' trade policy restrictiveness obtained while constraining NTMs to be trade reducing.

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Bibliographic Info

Paper provided by HAL in its series PSE Working Papers with number hal-00961727.

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Date of creation: Jul 2013
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Handle: RePEc:hal:psewpa:hal-00961727

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Keywords: Non-tariff measures ; Externalities ; Ad valorem equivalents ; Trade restrictiveness indices;

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  1. James E. Anderson & J. Peter Neary, 2003. "The Mercantilist Index of Trade Policy," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 44(2), pages 627-649, 05.
  2. Beghin, John C. & Bureau, Jean-Christophe & Park, Sung Joon, 2003. "Food Security and Agricultural Protection in South Korea," Staff General Research Papers 2006, Iowa State University, Department of Economics.
  3. J Anderson & J.P. Neary, 1994. "Measuring the Restrictiveness of Trade Policy," CEP Discussion Papers dp0186, Centre for Economic Performance, LSE.
  4. Ronald Fischer & Pablo Serra, 1998. "Standards and Protection," Documentos de Trabajo 45, Centro de Economía Aplicada, Universidad de Chile.
  5. James E. Anderson & J. Peter Neary, 2005. "Measuring the Restrictiveness of International Trade Policy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262012200, December.
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  9. Nancy H. Chau & Rolf Färe & Shawna Grosskopf, 2013. "Trade Restrictiveness and Pollution," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 15(1), pages 25-52, 02.
  10. Anne-Célia Disdier & Stéphan Marette, 2010. "The Combination of Gravity and Welfare Approaches for Evaluating Nontariff Measures," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 92(3), pages 713-726.
  11. Copeland Brian R., 1994. "International Trade and the Environment: Policy Reform in a Polluted Small Open Economy," Journal of Environmental Economics and Management, Elsevier, vol. 26(1), pages 44-65, January.
  12. Anderson, James E & Neary, J Peter, 1992. "Trade Reform with Quotas, Partial Rent Retention, and Tariffs," Econometrica, Econometric Society, vol. 60(1), pages 57-76, January.
  13. Colen, Liesbeth & Maertens, Miet, 2011. "Private Standards and Employment Insecurity: GlobalGAP in the Senegalese Horticulture Export Sector," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114286, European Association of Agricultural Economists.
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