Rules of origin as export subsidies
AbstractThe paper estimates the effect of NAFTAâs rules of origin (ROO) on Mexican access to the US market treating explicitly the endogenous determination of ROOs. The first equation determines Mexicoâs NAFTA (preferential) exports to the US as a function of tariff preference and Estevadeordalâs qualitative ROO index. The second equation determines ROO strictness on the basis of a Grossman-Helpman model identifying channels through which lobbying by US intermediate-good producers leads to deep preferences and stiff rules of origin in downstream sectors. The estimates suggest that the creation of a captive market for upstream intermediate-good producers is indeed one of their political determinants.
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Bibliographic InfoPaper provided by Laboratoire d'Economie Appliquee, INRA in its series Research Unit Working Papers with number 0405.
Length: 27 pages
Date of creation: Feb 2004
Date of revision:
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NAFTA; rules of origin; regional integration;
Other versions of this item:
- F10 - International Economics - - Trade - - - General
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
- F15 - International Economics - - Trade - - - Economic Integration
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-07-18 (All new papers)
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