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The Origin of Goods: Rules of Origin in Regional Trade Agreements


  • Cadot, Olivier
    (University of Lausanne and CEPR)

  • Estevadeordal, Antoni
    (Inter-American Development Bank)

  • Suwa-Eisenmann, Akiko
    (Institut National de la Recherche Agronomique (INRA), Paris-Jourdan, France)

  • Verdier, Thierry
    (DELTA and CEPR)


The dark side of preferential trade agreements, Rules of Origin (RoO) are used to determine the eligibility of goods to preferential treatment. Ostensibly meant to prevent the trans-shipment of imported products across Free Trade Agreement borders after superficial screwdriver assembly, they act in reality as complex and opaque trade barriers. This book provides evidence strongly suggesting that they do so by intent rather than accidentally---in other words, that RoOs are policy. Part one draws insights about the effects of RoOs on cross-border trade and outsourcing from recent economic theory. Part two reviews the evidence on RoOs in preferential agreements around the world, putting together the most comprehensive dataset on RoOs to date. Part three explores their "political economy"---how special interests have shaped them and continue to do so. Part four provides econometric evidence on their costs for exporters and consequent effects on trade flows. Finally, part five explores how they affect trade in the developing world where they spread rapidly and have the potential to do most harm. Beyond the collection of new evidence and its interpretation in light of recent theory, the book's overall message for the policy community is that RoOs are a potentially powerful and new barrier to trade. Rather than being relegated to closed-door technical meetings, their design should hold center-stage in trade negotiations. Contributors to this volume - Olivier Cadot, University of Lausanne and CEPR Antoni Estevadeordal, Inter-American Development Bank Akiko Suwa, DELTA/INRA Thierry Verdier, DELTA and CEPR Kala Krishna, Pennsylvania State University and NBER Matthias Thoenig, CERAS and CNRS Kati Suominen, IDB Americo Beviglia-Zampetti, UNCTAD Pierre Sauve, Institut d'Etudes Politiques I.M. Destler, University of Maryland and Institute for International Economics Celine Carrere, University of Auvergne Jaime de Melo, University of Geneva Pablo Sanguinetti, UTDT E. Bianchi, IPECI Joseph Francois, Tinbergen Institute and CEPR Hennie Erasmus, SADC Secretariat Frank Flatters, Queen's University Robert Kirk, The Services Group Paul Brenton, World Bank Takako Ikezuki, World Bank

Suggested Citation

  • Cadot, Olivier & Estevadeordal, Antoni & Suwa-Eisenmann, Akiko & Verdier, Thierry (ed.), 2006. "The Origin of Goods: Rules of Origin in Regional Trade Agreements," OUP Catalogue, Oxford University Press, number 9780199290482.
  • Handle: RePEc:oxp:obooks:9780199290482

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    References listed on IDEAS

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    Cited by:

    1. Richard E. Baldwin, 2011. "Multilateralising Regionalism: Spaghetti Bowls as Building Blocks on the Path to Global Free Trade," Chapters,in: International Handbook on the Economics of Integration, Volume I, chapter 2 Edward Elgar Publishing.
    2. Portugal-Perez, Alberto, 2009. "Assessing the impact of political economy factors on rules of origin under NAFTA," Policy Research Working Paper Series 4848, The World Bank.
    3. Marco Fugazza & Frédéric Robert-Nicoud, 2014. "The “Emulator Effect” of the Uruguay Round on US Regionalism," Review of International Economics, Wiley Blackwell, vol. 22(5), pages 1049-1078, November.
    4. Paul Collier & Anthony J. Venables, 2007. "Rethinking Trade Preferences: How Africa Can Diversify its Exports," The World Economy, Wiley Blackwell, vol. 30(8), pages 1326-1345, August.
    5. Patrick Georges, 2009. "Dispensing with NAFTA Rules of Origin? Some Policy Options for Canada," Working Papers 0904E, University of Ottawa, Department of Economics.
    6. Richard E. Baldwin, 2006. "Multilateralising Regionalism: Spaghetti Bowls as Building Blocs on the Path to Global Free Trade," The World Economy, Wiley Blackwell, vol. 29(11), pages 1451-1518, November.
    7. Kelly Ruth, 2010. "EU and U.S. Non-Reciprocal Preferences: Maintaining the Acquis," The Law and Development Review, De Gruyter, vol. 3(1), pages 1-39, April.
    8. Sauvé, Pierre & Shingal, Anirudh, 2011. "Reflections on the Preferential Liberalization of Services Trade," Papers 146, World Trade Institute.
    9. Carrère, Céline & de Melo, Jaime, 2009. "The Doha Round and Market Access for LDCs: Scenarios for the EU and US Markets," CEPR Discussion Papers 7313, C.E.P.R. Discussion Papers.
    10. Chang, Yang-Ming & Xiao, Renfeng, 2015. "Preferential trade agreements between asymmetric countries: Free trade areas (with rules of origin) vs. customs unions," Japan and the World Economy, Elsevier, vol. 33(C), pages 28-43.
    11. Hayakawa, Kazunobu & Yamashita, Nobuaki, 2011. "The role of Preferential Trade Agreements (PTAs) in facilitating global production networks," IDE Discussion Papers 280, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    12. Stephenson, Sherry & Roberts, Maryse, 2011. "Evaluating the Contributions of Regional Trade Agreements to Governance of Services Trade," ADBI Working Papers 307, Asian Development Bank Institute.

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