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Measuring the costs of FTA utilization: evidence from transaction-level import data of Thailand

Author

Listed:
  • Kazunobu Hayakawa

    () (Institute of Developing Economies)

  • Nuttawut Laksanapanyakul

    (Thailand Development Research Institute)

  • Shujiro Urata

    (Waseda University)

Abstract

Abstract In this study, we measure the utilization costs of free trade agreement (FTA) tariff schemes. To do that, we use shipment-level customs data on Thai imports, which identify not only firms, source country, and commodity but also tariff schemes. We propose several measures as a proxy for FTA utilization costs. The example includes the minimum amount of firm-level savings on tariff payments, i.e., trade values under FTA schemes multiplied by the tariff margin, in all transactions. Consequently, the median costs for FTA utilization in 2008, for example, are estimated to be approximately US$2000 for exports from China, US$300 for exports from Australia, and US$1000 for exports from Japan. We also found that FTA utilization costs differ by rule of origin and industry.

Suggested Citation

  • Kazunobu Hayakawa & Nuttawut Laksanapanyakul & Shujiro Urata, 2016. "Measuring the costs of FTA utilization: evidence from transaction-level import data of Thailand," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 152(3), pages 559-575, August.
  • Handle: RePEc:spr:weltar:v:152:y:2016:i:3:d:10.1007_s10290-016-0248-y
    DOI: 10.1007/s10290-016-0248-y
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    References listed on IDEAS

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    Cited by:

    1. Hayakawa, Kazunobu & Nuttawut, Laksanapanyakul & Yoshimi, Taiyo, 2018. "Tariff scheme choice," IDE Discussion Papers 684, Institute of Developing Economies, Japan External Trade Organization(JETRO).

    More about this item

    Keywords

    FTA; Fixed costs; Thailand;

    JEL classification:

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

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