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Regionalism in standards: good or bad for trade?

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  • Maggie Xiaoyang Chen
  • Aaditya Mattoo

Abstract

. Regional agreements on standards have been largely ignored by economists and blessed by multilateral trade rules. Using a constructed panel data that identifies the different types of agreements at the industry level, we find that such agreements increase the trade between participating countries but not necessarily with the rest of the world. Harmonization of standards may reduce the exports of excluded countries, especially in markets that have raised the stringency of standards. Mutual recognition agreements are more uniformly trade promoting unless they contain restrictive rules of origin, in which case intra‐regional trade increases at the expense of imports from other countries. Les accords régionaux sur les normes ont été grandement ignorés par les économistes mais consacrés dans les règles multilatérales de commerce. Utilisant des données de panels qui identifient les différents types d'accord au niveau de l'industrie, on découvre que ces accords augmentent le commerce entre les pays participants, mais pas nécessairement avec le reste du monde. L'harmonisation des normes peut réduire les exportations des pays exclus, en particulier dans les marchés qui ont relevé leurs normes. Les accords de reconnaissance mutuelle promeuvent plus uniformément l'augmentation du commerce à moins qu'ils ne contiennent des restrictions quant aux pays d'origine. Dans ce dernier cas, les accroissements dans le commerce intra‐régional se font aux dépens des importations en provenance des autres pays.

Suggested Citation

  • Maggie Xiaoyang Chen & Aaditya Mattoo, 2008. "Regionalism in standards: good or bad for trade?," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 41(3), pages 838-863, August.
  • Handle: RePEc:wly:canjec:v:41:y:2008:i:3:p:838-863
    DOI: 10.1111/j.1540-5982.2008.00488.x
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    More about this item

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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