IDEAS home Printed from https://ideas.repec.org/a/bla/ajarec/v70y2026i2p470-487.html

Trade Liberalisation and Agricultural Exports: Evidence From Afghanistan’s WTO Accessions

Author

Listed:
  • Yuping Deng
  • Abdul Ahmad Pooya
  • Shah Mir Mowahed

Abstract

This paper examines the impact of Afghanistan's accession to the World Trade Organization (WTO) on its Agricultural Export Performance (LnAEP), with a particular focus on the effects of Trade Liberalisation (TLIB). Using the Difference‐ in‐ Differences (DIDs) methodology, we found that TLIB has a positive and statistically significant effect on LnAEP, suggesting that a 1% decrease in tariffs increases export value by approximately 0.124% in Afghanistan. This result is further validated by employing Double‐Selection LASSO Regression (DSLR), Bayesian Model Averaging (BMA) and Kernel‐Based Regularised Least Squares (KRLS) machine learning techniques. Additionally, endogeneity concerns are addressed using Trade Policy Uncertainty (LnTPU) as an Instrumental Variable (IV), with results indicating that the estimated effects are free from endogeneity bias. Moreover, heterogeneity analysis reveals that the impact of TLIB on LnAEP varies across different income levels, regions and neighbouring country classifications. Furthermore, a three‐step mediation analysis demonstrates that Trade Costs (LnTC) and Resource Allocation (LnRA) partially mediate the relationship between TLIB and LnAEP. Based on these empirical outcomes, several policy recommendations are discussed.

Suggested Citation

  • Yuping Deng & Abdul Ahmad Pooya & Shah Mir Mowahed, 2026. "Trade Liberalisation and Agricultural Exports: Evidence From Afghanistan’s WTO Accessions," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 70(2), pages 470-487, April.
    • Handle: RePEc:bla:ajarec:v:70:y:2026:i:2:p:470-487
    DOI: 10.1111/1467-8489.70092
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/1467-8489.70092
    Download Restriction: no
    File URL: https://libkey.io/10.1111/1467-8489.70092?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Qu, Yingzi & Fan, Sha, 2024. "Is there a "Machine Substitution"? How does the digital economy reshape the employment structure in emerging market countries," Economic Systems, Elsevier, vol. 48(4).
    2. Petia Topalova, 2010. "Factor Immobility and Regional Impacts of Trade Liberalization: Evidence on Poverty from India," American Economic Journal: Applied Economics, American Economic Association, vol. 2(4), pages 1-41, October.
    3. Fernandez, Carmen & Ley, Eduardo & Steel, Mark F. J., 2001. "Benchmark priors for Bayesian model averaging," Journal of Econometrics, Elsevier, vol. 100(2), pages 381-427, February.
    4. Aditya, Anwesha & Acharyya, Rajat, 2015. "Trade liberalization and export diversification," International Review of Economics & Finance, Elsevier, vol. 39(C), pages 390-410.
    5. Zhang, Zhewei & Xu, Zhiwei & Zhou, Fangxing, 2025. "Financial liberalization and capital allocation in China," China Economic Review, Elsevier, vol. 94(PA).
    6. Jean‐Christophe Bureau & Houssein Guimbard & Sébastien Jean, 2019. "Agricultural Trade Liberalisation in the 21st Century: Has It Done the Business?," Journal of Agricultural Economics, Wiley Blackwell, vol. 70(1), pages 3-25, February.
    7. Richard J. Sexton & Ian Sheldon & Steve McCorriston & Humei Wang, 2007. "Agricultural trade liberalization and economic development: the role of downstream market power," Agricultural Economics, International Association of Agricultural Economists, vol. 36(2), pages 253-270, March.
    8. Pian Shu & Claudia Steinwender, 2019. "The Impact of Trade Liberalization on Firm Productivity and Innovation," Innovation Policy and the Economy, University of Chicago Press, vol. 19(1), pages 39-68.
    9. Ma, Zhendong & Wang, Di & Feng, Fan & Zhao, Tianhui, 2025. "Moving out of agriculture: How trade liberalization affects agricultural productivity in China," China Economic Review, Elsevier, vol. 91(C).
    10. Chevassus-Lozza, Emmanuelle & Gaigné, Carl & Le Mener, Léo, 2013. "Does input trade liberalization boost downstream firms' exports? Theory and firm-level evidence," Journal of International Economics, Elsevier, vol. 90(2), pages 391-402.
    11. Phouphet Kyophilavong & Kazunobu Hayakawa, 2024. "Impacts of Trade Liberalization in the Least Developed Countries: Evidence From Lao PDR," The Developing Economies, Institute of Developing Economies, vol. 62(1), pages 45-67, March.
    12. Yin, Yixuan & Luo, Chenyue & Yang, Jing & Chen, Panyu & Chunding, LI, 2024. "Possible development path for agricultural economic and trade cooperation in FTAAP: A numerical simulation," Journal of Asian Economics, Elsevier, vol. 95(C).
    13. Wang, Sai & Meng, Ye & Xie, Wenwu, 2025. "Trade liberalization, road expansion, and factor market distortion," International Review of Economics & Finance, Elsevier, vol. 99(C).
    14. Arindrajit Dube & Daniele Girardi & Òscar Jordà & Alan M. Taylor, 2025. "A Local Projections Approach to Difference‐in‐Differences," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 40(7), pages 741-758, November.
    15. Olatunji Abdul Shobande, 2019. "Effect of Economic Integration on Agricultural Export Performance in Selected West African Countries," Economies, MDPI, vol. 7(3), pages 1-14, August.
    16. Atalar, Deniz, 2025. "Trade liberalization and quality upgrading: Third-country effects," Journal of Development Economics, Elsevier, vol. 177(C).
    17. Qin, Ni & Kong, Dongmin & Wang, Qin, 2024. "Trade liberalization and entrepreneurship: Evidence from China’s WTO accession," Journal of International Money and Finance, Elsevier, vol. 147(C).
    18. Krugman, Paul, 1980. "Scale Economies, Product Differentiation, and the Pattern of Trade," American Economic Review, American Economic Association, vol. 70(5), pages 950-959, December.
    19. Fan, Haichao & Lai, Edwin L.-C. & (Steffan) Qi, Han, 2019. "Trade liberalization and Firms’ export performance in China: Theory and evidence," Journal of Comparative Economics, Elsevier, vol. 47(3), pages 640-668.
    20. Gnangnon, Sèna Kimm, 2018. "Impact of multilateral trade liberalization and aid for trade for productive capacity building on export revenue instability," Economic Analysis and Policy, Elsevier, vol. 58(C), pages 141-152.
    21. Ratnaike, Yasanji C., 2012. "Is there an empirical link between trade liberalisation and export performance?," Economics Letters, Elsevier, vol. 117(1), pages 375-378.
    22. Xie, Enze & Xu, Mingzhi & Yu, Miaojie, 2024. "Trade liberalization, labor market power, and misallocation across firms: Evidence from China's WTO accession," Journal of Development Economics, Elsevier, vol. 171(C).
    23. Sun, Puyang & Tan, Yong & Yang, Guang, 2020. "Export, FDI and the welfare gains from trade liberalization," Economic Modelling, Elsevier, vol. 92(C), pages 230-238.
    24. Yi Lu Jr. & Linhui Yu Jr., 2015. "Trade Liberalization and Markup Dispersion: Evidence from China's WTO Accession," American Economic Journal: Applied Economics, American Economic Association, vol. 7(4), pages 221-253, October.
    25. Petia Topalova & Amit Khandelwal, 2011. "Trade Liberalization and Firm Productivity: The Case of India," The Review of Economics and Statistics, MIT Press, vol. 93(3), pages 995-1009, August.
    26. Jingjing Qi, 2024. "Greening economic sectors through trade liberalization and efficient governance," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 11(1), pages 1-8, December.
    27. Nassir Ul Haq Wani, 2019. "Nexus between Openness to Trade and Economic Growth: An Empirical Investigation of Afghanistan," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 20(2), pages 205-223, September.
    28. Liu, Qing & Qiu, Larry D. & Zhan, Chaoqun, 2024. "FDI inflows and export quality: Domestic competition and within-firm adjustment," Journal of Development Economics, Elsevier, vol. 170(C).
    29. Nie, Fei & Etienne, Xiaoli & Li, Jian & Hu, Hualu, 2025. "Trade liberalization and manufacturing robot adoption: Evidence from Chinese free trade agreements," China Economic Review, Elsevier, vol. 94(PA).
    30. Akanksha Negi & Digvijay S. Negi, 2025. "Difference‐in‐Differences With a Misclassified Treatment," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 40(4), pages 411-423, June.
    31. Hainmueller, Jens & Hazlett, Chad, 2014. "Kernel Regularized Least Squares: Reducing Misspecification Bias with a Flexible and Interpretable Machine Learning Approach," Political Analysis, Cambridge University Press, vol. 22(2), pages 143-168, April.
    32. Bufan Wang & Pingyang Liu & Aixi Han, 2025. "Can E‐commerce development improve farmers' incomes? Evidence from prefecture‐level data and the spatial difference‐in‐difference approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 69(2), pages 344-368, April.
    33. Bruce E. Hansen, 2025. "Standard Errors for Difference‐in‐Difference Regression," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 40(3), pages 291-309, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Liu, Qing & Qiu, Larry D., 2016. "Intermediate input imports and innovations: Evidence from Chinese firms' patent filings," Journal of International Economics, Elsevier, vol. 103(C), pages 166-183.
    2. Malgouyres, Clément & Mayer, Thierry & Mazet-Sonilhac, Clément, 2021. "Technology-induced trade shocks? Evidence from broadband expansion in France," Journal of International Economics, Elsevier, vol. 133(C).
    3. Michele Imbruno & Rosanna Pittiglio & Filippo Reganati, 2015. "FDI, Intermediate Inputs and Firm Performance: Theory and Evidence from Italy," Discussion Papers 2015-15, University of Nottingham, GEP.
    4. Kai Sun & Xin Zhong & Ding Xiong, 2026. "The Impact of Cross‐Border E‐Commerce on Urban Entrepreneurial Activity: Evidence From Cross‐Border E‐Commerce Comprehensive Pilot Zones," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 47(3), pages 670-687, April.
    5. repec:spo:wpmain:info:hdl:2441/4b7tooefh48jlq7oktt0tbn8om is not listed on IDEAS
    6. Liu, Qing & Lu, Ruosi & Lu, Yi & Luong, Tuan Anh, 2021. "Import competition and firm innovation: Evidence from China," Journal of Development Economics, Elsevier, vol. 151(C).
    7. Jan De Loecker & Pinelopi K. Goldberg & Amit K. Khandelwal & Nina Pavcnik, 2016. "Prices, Markups, and Trade Reform," Econometrica, Econometric Society, vol. 84, pages 445-510, March.
    8. Daniele Curzi & Maria Garrone & Alessandro Olper, 2021. "Import Competition and Firm Markups in the Food Industry," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(4), pages 1433-1453, August.
    9. Gnangnon, Sèna Kimm, 2020. "Aid for Trade, Export Product Diversification and Import Product Diversification," EconStor Preprints 223021, ZBW - Leibniz Information Centre for Economics.
    10. Shiyi Chen & Wanlin Liu & Hong Song, 2020. "Broadband Internet, Firm Performance, And Worker Welfare: Evidence And Mechanism," Economic Inquiry, Western Economic Association International, vol. 58(3), pages 1146-1166, July.
    11. Yu, Zhen & Wu, Xiaoling & Li, Meng & Guo, Rufei, 2021. "Import competition and the gender gap in labor force participation: Evidence from China," China Economic Review, Elsevier, vol. 69(C).
    12. Qilin Mao & Jiayun Xu, 2024. "WTO accession, input trade liberalization and employment adjustment in Chinese manufacturing," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 160(1), pages 1-53, February.
    13. Michele Imbruno, 2014. "Trade Liberalization, Intermediate Inputs and Firm Efficiency: Direct versus Indirect Modes of Import," Discussion Papers 2014-02, University of Nottingham, GEP.
    14. Ke Ding & Helian Xu & Rongming Yang, 2021. "Taxation and Enterprise Innovation: Evidence from China’s Value-Added Tax Reform," Sustainability, MDPI, vol. 13(10), pages 1-20, May.
    15. Songbo Wu & Yue Lu & Xiaofeng Lv, 2021. "Does value‐added tax reform boost firms’ domestic value added in exports? Evidence from China," Review of International Economics, Wiley Blackwell, vol. 29(5), pages 1275-1299, November.
    16. Zhengwen Liu & Hong Ma, 2021. "Input Trade Liberalization And Markup Distribution: Evidence From China," Economic Inquiry, Western Economic Association International, vol. 59(1), pages 344-360, January.
    17. repec:spo:wpecon:info:hdl:2441/4b7tooefh48jlq7oktt0tbn8om is not listed on IDEAS
    18. Miaojie Yu & Jin Li, 2014. "Imported Intermediate Inputs, Firm Productivity and Product Complexity," The Japanese Economic Review, Japanese Economic Association, vol. 65(2), pages 178-192, June.
    19. Bas, Maria & Paunov, Caroline, 2021. "Disentangling trade reform impacts on firm market and production decisions," European Economic Review, Elsevier, vol. 135(C).
    20. Gehrke, Esther & Genthner, Robert & Kis-Katos, Krisztina, 2025. "Regulating manufacturing FDI: Local labor market responses to a protectionist policy in Indonesia," Journal of Development Economics, Elsevier, vol. 177(C).
    21. Nihar Shembavnekar, 2015. "Tariff Liberalisation, Labour Market Flexibility and Employment: Evidence from India," Working Paper Series 8115, Department of Economics, University of Sussex Business School.
    22. Bosker, Maarten & Haasbroek, Megan, 2024. "Domestic Infrastructure and the Regional Effects of Trade Liberalization," CEPR Discussion Papers 19780, Centre for Economic Policy Research.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ajarec:v:70:y:2026:i:2:p:470-487. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/aaresea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.