Trade facilitation and economic development : measuring the impact
AbstractThe authors analyze the relationship between trade facilitation, trade flows, and GDP per capita in the Asia-Pacific region for the goods sector. They define and measure trade facilitation using four broad indicators. These are constructed using country-specific data for port efficiency, customs environment, regulatory environment, and electronic-business usage. They estimate the relationship between these indicators and trade flows using a gravity model. The model includes tariffs and other standard variables. The authors find that enhanced port efficiency has a large and positive effect on trade. Regulatory barriers deter trade. The results also suggest that improvements in customs and greater electronic-business use significantly expands trade, but to a lesser degree than the effect of ports or regulations. The authors then estimate the benefits of specific trade facilitation efforts by quantifying differential improvement by members of the Asia Pacific Economic Cooperation (APEC) in these four areas. Based on a scenario in which APEC members below average improve capacity halfway to the average for all members, the authors find that intra-APEC trade could increase by $254 billion. This represents approximately a 21 percent increase in intra-APEC trade flows, about halfcoming from improved port efficiencies in the region. Using Dollar and Kraay's estimate of the effect of trade on per capita GDP, these improvements in trade facilitation suggest an increase in APEC average per capita GDP of 4.3 percent.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by The World Bank in its series Policy Research Working Paper Series with number 2988.
Date of creation: 31 Mar 2003
Date of revision:
Transport and Trade Logistics; Trade Policy; Environmental Economics&Policies; Common Carriers Industry; Economic Theory&Research;
This paper has been announced in the following NEP Reports:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Carsten Fink & Aaditya Mattoo & Ileana Cristina Neagu, 2002.
"Trade in International Maritime Services: How Much Does Policy Matter?,"
World Bank Economic Review,
World Bank Group, vol. 16(1), pages 81-108, June.
- Fink, Carsten & Mattoo, Aaditya & Neagu, Ileana Cristina, 2001. "Trade in international maritime services : how much does policy matter?," Policy Research Working Paper Series 2522, The World Bank.
- Hertel, Thomas W. & Terrie Walmsley & Ken Itakura, 2001.
"Dynamic Effects of the "New Age" Free Trade Agreement between Japan and Singapore,"
GTAP Working Papers
823, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
- W. Hertel, Thomas, 2001. "Dynamic Effects of the “New Age” Free Trade Agreement between Japan and Singapore," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 16, pages 446-484.
- Robert C. Feenstra & James A. Markusen & Andrew K. Rose, 1998.
"Undertstanding the Home Market Effect and the Gravity Equation: The Role of Differentiating Goods,"
NBER Working Papers
6804, National Bureau of Economic Research, Inc.
- Feenstra, Robert & Markusen, James R. & Rose, Andrew K, 1998. "Understanding the Home Market Effect and the Gravity Equation: The Role of Differentiating Goods," CEPR Discussion Papers 2035, C.E.P.R. Discussion Papers.
- Dollar, David & Micco, Alejandro & Clark, Ximena, 2002. "Maritime transport costs and port efficiency," Policy Research Working Paper Series 2781, The World Bank.
- Simon J. Evenett & Wolfgang Keller, 2002.
"On Theories Explaining the Success of the Gravity Equation,"
Journal of Political Economy,
University of Chicago Press, vol. 110(2), pages 281-316, April.
- Simon J. Evenett & Wolfgang Keller, 1996. "On Theories Explaining the Success of the Gravity Equation," International Trade 9608001, EconWPA, revised 13 Jun 1997.
- Simon J. Evenett & Wolfgang Keller, 1998. "On Theories Explaining the Success of the Gravity Equation," NBER Working Papers 6529, National Bureau of Economic Research, Inc.
- Evenett, S. J. & Keller, W., 1994. "On Theories Explaining the Success of the Gravity Equation," Working papers 9713, Wisconsin Madison - Social Systems.
- Fink, Carsten & Mattoo, Aaditya & Neagu, Ileana Cristina, 2005.
"Assessing the impact of communication costs on international trade,"
Journal of International Economics,
Elsevier, vol. 67(2), pages 428-445, December.
- Fink, Carsten & Mattoo, Aaditya & Neagu, Ileana Cristina, 2002. "Assessing the impact of communication costs on international trade," Policy Research Working Paper Series 2929, The World Bank.
- Tsunehiro Otsuki & John S. Wilson, 2001. "What price precaution? European harmonisation of aflatoxin regulations and African groundnut exports," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 28(3), pages 263-284, October.
- James E. Anderson & Eric van Wincoop, 2000.
"Gravity with Gravitas: A Solution to the Border Puzzle,"
Boston College Working Papers in Economics
485, Boston College Department of Economics.
- James E. Anderson & Eric van Wincoop, 2003. "Gravity with Gravitas: A Solution to the Border Puzzle," American Economic Review, American Economic Association, vol. 93(1), pages 170-192, March.
- James E. Anderson & Eric van Wincoop, 2001. "Gravity with Gravitas: A Solution to the Border Puzzle," NBER Working Papers 8079, National Bureau of Economic Research, Inc.
- Anderson, James E, 1979. "A Theoretical Foundation for the Gravity Equation," American Economic Review, American Economic Association, vol. 69(1), pages 106-16, March.
- Caroline L. Freund & Diana Weinhold, 2000. "On the effect of the Internet on international trade," International Finance Discussion Papers 693, Board of Governors of the Federal Reserve System (U.S.).
- Edward Balistreri & Russell Hillberry, 2006. "Trade frictions and welfare in the gravity model: how much of the iceberg melts?," Canadian Journal of Economics, Canadian Economics Association, vol. 39(1), pages 247-265, February.
- Otsuki, Tsunehiro & Wilson, John S. & Sewadeh, Mirvat, 2001. "Saving two in a billion: : quantifying the trade effect of European food safety standards on African exports," Food Policy, Elsevier, vol. 26(5), pages 495-514, October.
- Patrick A. Messerlin & Jamel Zarrouk, 2000. "Trade Facilitation: Technical Regulations and Customs Procedures," The World Economy, Wiley Blackwell, vol. 23(04), pages 577-593, 04.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi).
If references are entirely missing, you can add them using this form.