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Trade Restrictiveness Indices in Presence of Externalities: An Application to Non-Tariff Measures

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Listed:
  • Beghin, John C.
  • Disdier, Anne-Célia
  • Marette, Stephan

Abstract

We extend the trade restrictiveness index approach to the case of market imperfections and domestic regulations addressing them. We focus on standard-like non-tariff measures (NTMs) affecting cost of production and potentially enhancing demand by reducing negative externalities. We apply the framework to the database of Kee et al. (2009) and derive ad valorem equivalents (AVEs) for technical measures. About 39% of the product lines affected by NTMs exhibit negative AVEs, indicating a net trade-facilitating effect of these measures. Accounting for these effects significantly reduces previous measures of countries’ trade policy restrictiveness obtained while constraining these NTMs to be trade reducing.

Suggested Citation

  • Beghin, John C. & Disdier, Anne-Célia & Marette, Stephan, 2014. "Trade Restrictiveness Indices in Presence of Externalities: An Application to Non-Tariff Measures," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182761, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae14:182761
    DOI: 10.22004/ag.econ.182761
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    References listed on IDEAS

    as
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    Keywords

    International Relations/Trade;

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    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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