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National Trade Policies and Smuggling in Africa: The Case of The Gambia and Senegal

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  • Golub, Stephen S.
  • Mbaye, Ahmadou Aly

Abstract

Summary Much of inter-regional trade in Africa is unrecorded and consists of smuggling. The Gambia is almost wholly enclosed within Senegal, yet official trade statistics show almost no trade between the two countries, failing to capture large-scale smuggling. Smuggling reflects pre-colonial traditional trading relationships, the artificial nature of borders created in the colonial era, and the disparities in trade policies between the two countries following independence, inducing large cross-border price differentials for goods. This paper documents the magnitude of trade protection in the two countries, the resulting price differences, and estimates the volume of smuggling.

Suggested Citation

  • Golub, Stephen S. & Mbaye, Ahmadou Aly, 2009. "National Trade Policies and Smuggling in Africa: The Case of The Gambia and Senegal," World Development, Elsevier, vol. 37(3), pages 595-606, March.
  • Handle: RePEc:eee:wdevel:v:37:y:2009:i:3:p:595-606
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    References listed on IDEAS

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    1. Yongzheng Yang & Sanjeev Gupta, 2005. "Regional Trade Arrangements in Africa; Past Performance and the Way Forward," IMF Working Papers 05/36, International Monetary Fund.
    2. Jagdish Bhagwati & Bent Hansen, 1973. "A Theoretical Analysis of Smuggling," The Quarterly Journal of Economics, Oxford University Press, vol. 87(2), pages 172-187.
    3. Alan Deardorff & Wolfgang Stolper, 1990. "Effects of smuggling under african conditions: A factual, institutional and analytic discussion," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 126(1), pages 116-141, March.
    4. O'Connell, Stephen A, 1992. "Uniform Commercial Policy, Illegal Trade, and the Real Exchange Rate: A Theoretical Analysis," World Bank Economic Review, World Bank Group, vol. 6(3), pages 459-479, September.
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    Citations

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    Cited by:

    1. Howson, Cynthia, 2013. "Adverse Incorporation and Microfinance among Cross-Border Traders in Senegal," World Development, Elsevier, vol. 42(C), pages 199-208.
    2. Gardner, Leigh, 2015. "The curious incident of the franc in the Gambia: exchange rate instability and imperial monetary systems in the 1920s," Financial History Review, Cambridge University Press, vol. 22(03), pages 291-314, December.
    3. Ahmadou Aly Mbaye & Nancy Benjamin & Stephen Golub & Jean-Jacques Ekomie, 2014. "The Urban Informal Sector in Francophone Africa: Large Versus Small Enterprises in Benin, Burkina Faso and Senegal," Working Papers 201405, University of Cape Town, Development Policy Research Unit.
    4. Nancy Benjamin & Ahmadou Aly Mbaye, 2012. "The Informal Sector in Francophone Africa : Firm Size, Productivity, and Institutions
      [Les entreprises informelles de l'Afrique de l'ouest francophone : Taille, productivité et institutions]
      ," World Bank Publications, The World Bank, number 9364.
    5. Janet Ceglowski & Stephen Golub & Aly Mbaye & Varun Prasad, 2015. "Can Africa Compete with China in Manufacturing? The Role of Relative Unit Labor Costs," Working Papers 201504, University of Cape Town, Development Policy Research Unit.

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