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Privatisation and the unusual case of Belarusian accession to the WTO

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  • Edward J. Balistreri
  • Zoryana Olekseyuk
  • David G. Tarr

Abstract

The accession negotiations of Belarus to the WTO are unusual since, due to its obligations in the Eurasian Economic Union, WTO accession is not expected to impact its tariffs or formerly substantial trade distorting agricultural subsidies. Nonetheless, we estimate that WTO accession will increase welfare by 8.8 percent per year in Belarus in the medium term. We show that inclusion of (i) foreign direct investment; (ii) reduction on non-discriminatory barriers against services providers; and (iii) our model with imperfect competition and endogenous productivity effects together produce esti-mated gains eleven times larger than a model of perfect competition with only cross-border trade in services. Our analysis is enabled by our production of a dataset on both discriminatory and non-discriminatory barriers in services and their ad valorem equivalents. Based on a new dataset on labor productivity by sector and type of ownership, in our central model we estimate that privatization will increase welfare by 35.4 percent. We find substantial variance in the estimated gains from privatiza-tion depending on model assumptions; but all the estimates of the impacts of privatization indicate substantial welfare gains.
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  • Edward J. Balistreri & Zoryana Olekseyuk & David G. Tarr, 2017. "Privatisation and the unusual case of Belarusian accession to the WTO," The World Economy, Wiley Blackwell, vol. 40(12), pages 2564-2591, December.
  • Handle: RePEc:bla:worlde:v:40:y:2017:i:12:p:2564-2591
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    More about this item

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models

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