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Is there reciprocity in preferential trade agreements on services?

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  • Marchetti, Juan
  • Roy, Martin
  • Zoratto, Laura

Abstract

Are market access commitments on services in Preferential Trade Agreements (PTAs) reciprocal or simply unilateral? If reciprocal, do concessions granted in services depend on concessions received from the trading partner in other services or in non-services areas as well? In this paper we investigate the presence of reciprocity in bilateral services agreements, by sub-sector, mode of supply and type of agreement (North-North, South-North, South-South). To do so, we use a database of concessions given and received by 36 WTO Members in 40 services PTAs. Results reveal the presence of reciprocity at the product (sub-sector) level and across economic sectors (i.e., preferences in services trade in exchange for preferences received in goods trade). Reciprocity is stronger in agreements between developed countries. The findings provide insights into motivations for services PTAs, but also the multilateral negotiations. Indeed, the negotiation of services PTAs provides an incentive to withhold services offers in the Doha Round in order to extract more - reciprocal - concessions at a bilateral level. The existence of reciprocity on a sectoral basis may also hold lessons on optimal ways to improve the multilateral negotiating process.

Suggested Citation

  • Marchetti, Juan & Roy, Martin & Zoratto, Laura, 2012. "Is there reciprocity in preferential trade agreements on services?," WTO Staff Working Papers ERSD-2012-16, World Trade Organization (WTO), Economic Research and Statistics Division.
    • Handle: RePEc:zbw:wtowps:ersd201216
    DOI: 10.30875/98f3d304-en
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    Cited by:

    1. Marchetti, Juan A. & Roy, Martin, 2013. "The Tisa initiative: An overview of market access issues," WTO Staff Working Papers ERSD-2013-11, World Trade Organization (WTO), Economic Research and Statistics Division.
    2. Egger, Peter & MILE 02, Anirudh Shingal, 2014. "Determinants of services trade agreements," Papers 721, World Trade Institute.
    3. Pierre Sauvé & Anirudh Shingal, 2016. "Why Do Economies Enter into Preferential Agreements on Trade in Services? Assessing the Potential for Negotiated Regulatory Convergence in Asian Services Markets," Asian Development Review, MIT Press, vol. 33(1), pages 56-73, March.
    4. Sauvé, Pierre & Shingal, Anirudh, 2014. "Why do Countries enter into Preferential Agreements on Trade in Services? Assessing the Potential for Negotiated Regulatory Convergence in Asian Services Markets," Working Papers on Regional Economic Integration 129, Asian Development Bank.
    5. Peter H. Egger & Anirudh Shingal, 2017. "Granting preferential market access in services sequentially versus jointly with goods," The World Economy, Wiley Blackwell, vol. 40(12), pages 2901-2936, December.
    6. Roy, Martin, 2019. "Elevating services: Services trade policy, WTO commitments, and their role in economic development and trade integration," WTO Staff Working Papers ERSD-2019-01, World Trade Organization (WTO), Economic Research and Statistics Division.
    7. Erik der Marel & Sébastien Miroudot, 2014. "The economics and political economy of going beyond the GATS," The Review of International Organizations, Springer, vol. 9(2), pages 205-239, June.
    8. Peter Egger & Anirudh Shingal, 2021. "Determinants of services trade agreement membership," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 157(1), pages 21-64, February.

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    More about this item

    Keywords

    Services; Preferential Trade Agreements; reciprocity; WTO; GATS;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration
    • F19 - International Economics - - Trade - - - Other
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations

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