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How do free trade agreements change import prices? : firm-level evidence from China's imports from ASEAN

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  • Hayakawa, Kazunobu
  • Yang, Chih-Hai

Abstract

The literature has revealed the positive impacts of free trade agreements (FTAs) on export prices by employing product-level trade data. This paper empirically examines the impacts of FTAs on import prices at the firm level. We focus on firm-level imports in China from ASEAN countries by employing China’s firm-product-level trade data. As a result, controlling for firm characteristics and product characteristics, we could not find significantly positive impacts of an FTA’s entry into force on import prices of FTA eligible products. Instead, we found a significant increase in import quantities of FTA eligible products. Thus, at the firm level, the gains from FTAs for exporters may be the increase in export quantities rather than the rise in export prices.

Suggested Citation

  • Hayakawa, Kazunobu & Yang, Chih-Hai, 2013. "How do free trade agreements change import prices? : firm-level evidence from China's imports from ASEAN," IDE Discussion Papers 436, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    • Handle: RePEc:jet:dpaper:dpaper436
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    References listed on IDEAS

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    Cited by:

    1. Kwark, Noh-Sun & Lim, Hosung, 2020. "Have the free trade agreements reduced inflation rates?," Economics Letters, Elsevier, vol. 189(C).
    2. Bastos, Paulo & Silva, Joana, 2010. "The quality of a firm's exports: Where you export to matters," Journal of International Economics, Elsevier, vol. 82(2), pages 99-111, November.

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    More about this item

    Keywords

    China; Southeast Asia; International trade; Free Trade Agreement (FTA); Imports; Prices; FTA utilization;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration

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