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Sorting It Out: Technical Barriers to Trade and Industry Productivity

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  • Felbermayr, Gabriel
  • Jung, Benjamin

Abstract

Trade economists traditionally study the effect of lower variable trade costs. While increasingly important politically, technical barriers to trade (TBTs) have received less attention. Viewing TBTs as fixed regulatory costs related to the entry into export markets, we use a model with heterogeneous firms, trade in differentiated goods, and variable external economies of scale to sort out the rich interactions between TBT reform, input diversity, firm-level productivity, and aggregate productivity. We calibrate the model for 14 industries in order to clarify the theoretical ambiguities. Overall, our results tend to suggest beneficial effects of TBT reform but also reveal interesting sectoral variation.

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Bibliographic Info

Paper provided by University of Munich, Department of Economics in its series Munich Reprints in Economics with number 20575.

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Date of creation: 2011
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Publication status: Published in Open Economies Review 1 22(2011): pp. 93-117
Handle: RePEc:lmu:muenar:20575

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References

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Citations

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Cited by:
  1. Gabriel Felbermayr & Benjamin Jung, 2011. "Sorting It Out: Technical Barriers to Trade and Industry Productivity," Open Economies Review, Springer, vol. 22(1), pages 93-117, February.
  2. Benjamin Jung, 2012. "Optimal fixed cost subsidies in Melitz-type models," Empirica, Springer, vol. 39(1), pages 87-108, February.
  3. Felbermayr, Gabriel & Jung, Benjamin & Larch, Mario, 2013. "Optimal tariffs, retaliation, and the welfare loss from tariff wars in the Melitz model," Munich Reprints in Economics 20591, University of Munich, Department of Economics.
  4. Witold Czubala & Ben Shepherd & John S. Wilson, 2009. "Help or Hindrance? The Impact of Harmonised Standards on African Exports †," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 18(5), pages 711-744, November.
  5. Felbermayr, Gabriel & Jung, Benjamin & Larch, Mario, 2012. "Tariffs and welfare in new trade theory models," University of Tuebingen Working Papers in Economics and Finance 41, University of Tuebingen, Faculty of Economics and Social Sciences.

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