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Recent developments in the measurement of the effects of trade policy: index number method and trade restrictiveness index

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  • Luca Salvatici

Abstract

In the policy arena, there is a demand for “trade distortion indicatorsâ€, but many of the traditional indices are difficult to compute and interpret. Recent developments in the literature have led to new indicators: the Trade Restrictiveness Index (TRI) - measuring the tariff equivalent in terms of welfare -, and the Index Number Method (INM) - measuring the tariff equivalent of the deadweight loss from quality upgrading. This paper shows that the INM can be extended in order to compute a measure of trade distortion equivalent to the TRI.

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Bibliographic Info

Paper provided by University of Rome La Sapienza, Department of Public Economics in its series Working Papers with number 27.

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Length: 17
Date of creation: Jul 1997
Date of revision:
Handle: RePEc:sap:wpaper:wp27

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  1. Neary, J Peter, 1989. "Trade Liberalization and Shadow Prices in the Presence of Tariffs and Quotas," CEPR Discussion Papers 345, C.E.P.R. Discussion Papers.
  2. Salvatici, Luca & Carter, Colin A. & Sumner, Daniel A., 1997. "The Trade Restrictiveness Index: The Potential Contribution To Agricultural Policy Analysis," 1997 Annual meeting, July 27-30, Toronto, Canada 21028, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  3. Pritchett, Lant, 1996. "Measuring outward orientation in LDCs: Can it be done?," Journal of Development Economics, Elsevier, vol. 49(2), pages 307-335, May.
  4. Cornes,Richard, 1992. "Duality and Modern Economics," Cambridge Books, Cambridge University Press, number 9780521336017.
  5. Anderson, James E & Neary, J Peter, 1996. "A New Approach to Evaluating Trade Policy," Review of Economic Studies, Wiley Blackwell, vol. 63(1), pages 107-25, January.
  6. Hatta, Tatsuo, 1977. "A Theory of Piecemeal Policy Recommendations," Review of Economic Studies, Wiley Blackwell, vol. 44(1), pages 1-21, February.
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