IDEAS home Printed from https://ideas.repec.org/p/ags/gagfdp/275059.html
   My bibliography  Save this paper

Exports and governance: the role of private voluntary standards

Author

Listed:
  • Fiankor, Dela-Dem Doe
  • Martinez-Zarzoso, Inmaculada
  • Brümmer, Bernhard

Abstract

The empirical evidence that institutional differences across countries affect bilateral trade is robust. The crucial question remains how countries can enhance trade amid these differences. In this paper, we measure the degree to which governance and institutions differ between countries as “governance distance”. Using a sample of EU/EFTA imports, we examine how the adoption of private food standards and certifications modify the effect of governance distance on exports within a structural gravity framework. Our results show that while increasing governance distance hinders bilateral trade, the interaction of standards and the governance distance is positively associated with exports, hence partially offsetting their direct trade–inhibiting effects. GlobalGAP certified countries see the trade-inhibiting effects of governance distance on their exports reduced by about 50%, ceteris paribus.

Suggested Citation

  • Fiankor, Dela-Dem Doe & Martinez-Zarzoso, Inmaculada & Brümmer, Bernhard, 2018. "Exports and governance: the role of private voluntary standards," GlobalFood Discussion Papers 275059, Georg-August-Universitaet Goettingen, GlobalFood, Department of Agricultural Economics and Rural Development.
  • Handle: RePEc:ags:gagfdp:275059
    as

    Download full text from publisher

    File URL: http://ageconsearch.umn.edu/record/275059/files/GlobalFood_DP125.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Beverelli, Cosimo & Keck, Alexander & Larch, Mario & Yotov, Yoto, 2018. "Institutions, Trade and Development: A Quantitative Analysis," School of Economics Working Paper Series 2018-3, LeBow College of Business, Drexel University.
    2. James E. Anderson & Eric van Wincoop, 2003. "Gravity with Gravitas: A Solution to the Border Puzzle," American Economic Review, American Economic Association, vol. 93(1), pages 170-192, March.
    3. Baldwin, Richard, 2007. "Trade Effects of the Euro: a Comparison of Estimators," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 22, pages 780-818.
    4. Margherita Scoppola & Valentina Raimondi & Alessandro Olper, 2018. "The impact of EU trade preferences on the extensive and intensive margins of agricultural and food products," Agricultural Economics, International Association of Agricultural Economists, vol. 49(2), pages 251-263, March.
    5. Felbermayr, Gabriel J. & Toubal, Farid, 2010. "Cultural proximity and trade," European Economic Review, Elsevier, vol. 54(2), pages 279-293, February.
    6. Alessandro Olper & Valentina Raimondi, 2009. "Patterns and Determinants of International Trade Costs in the Food Industry," Journal of Agricultural Economics, Wiley Blackwell, vol. 60(2), pages 273-297.
    7. repec:cup:jinsec:v:13:y:2017:i:03:p:599-621_00 is not listed on IDEAS
    8. Bruce Kogut & Harbir Singh, 1988. "The Effect of National Culture on the Choice of Entry Mode," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 19(3), pages 411-432, September.
    9. Henri L. F. de Groot & Gert-Jan Linders & Piet Rietveld & Uma Subramanian, 2004. "The Institutional Determinants of Bilateral Trade Patterns," Kyklos, Wiley Blackwell, vol. 57(1), pages 103-123, February.
    10. Andrei A. Levchenko, 2007. "Institutional Quality and International Trade," Review of Economic Studies, Oxford University Press, vol. 74(3), pages 791-819.
    11. James E. Anderson & Douglas Marcouiller, 2002. "Insecurity And The Pattern Of Trade: An Empirical Investigation," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 342-352, May.
    12. Santos Silva, J.M.C. & Tenreyro, Silvana, 2011. "Further simulation evidence on the performance of the Poisson pseudo-maximum likelihood estimator," Economics Letters, Elsevier, vol. 112(2), pages 220-222, August.
    13. Yu, Miaojie, 2010. "Trade, democracy, and the gravity equation," Journal of Development Economics, Elsevier, vol. 91(2), pages 289-300, March.
    14. Goedhuys, Micheline & Sleuwaegen, Leo, 2016. "International standards certification, institutional voids and exports from developing country firms," International Business Review, Elsevier, vol. 25(6), pages 1344-1355.
    15. repec:cup:jagaec:v:49:y:2017:i:02:p:296-322_00 is not listed on IDEAS
    16. repec:eee:reveco:v:53:y:2018:i:c:p:185-202 is not listed on IDEAS
    17. Marilyne Huchet‐Bourdon & Angela Cheptea, 2011. "Informal barriers and agricultural trade: does monetary integration matter?," Agricultural Economics, International Association of Agricultural Economists, vol. 42(4), pages 519-530, July.
    18. Charles P. Oman & Christiane Arndt, 2006. "Governance Indicators for Development," OECD Development Centre Policy Insights 33, OECD Publishing.
    19. repec:bla:agecon:v:47:y:2016:i:s1:p:7-19 is not listed on IDEAS
    20. repec:hal:journl:halshs-00641280 is not listed on IDEAS
    21. Álvarez, Inmaculada C. & Barbero, Javier & Rodríguez-Pose, Andrés & Zofío, José L., 2018. "Does Institutional Quality Matter for Trade? Institutional Conditions in a Sectoral Trade Framework," World Development, Elsevier, vol. 103(C), pages 72-87.
    22. Lio, Monchi & Liu, Meng-Chun, 2008. "Governance and agricultural productivity: A cross-national analysis," Food Policy, Elsevier, vol. 33(6), pages 504-512, December.
    23. John Hudson & Philip Jones, 2003. "International trade in 'quality goods': signalling problems for developing countries," Journal of International Development, John Wiley & Sons, Ltd., vol. 15(8), pages 999-1013.
    24. Korschun, Daniel & Dimitrova, Boryana & Yotov, Yoto, 2015. "When and How Country Reputation Stimulates Export Volume," School of Economics Working Paper Series 2015-4, LeBow College of Business, Drexel University.
    25. Bedassa Tadesse & Roger White, 2010. "Cultural distance as a determinant of bilateral trade flows: do immigrants counter the effect of cultural differences?," Applied Economics Letters, Taylor & Francis Journals, vol. 17(2), pages 147-152, January.
    26. Majid Abdi & Preet S Aulakh, 2012. "Do country-level institutional frameworks and interfirm governance arrangements substitute or complement in international business relationships?," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 43(5), pages 477-497, June.
    27. Horsewood, Nicholas & Voicu, Anca Monika, 2012. "Does corruption hinder trade for the new EU members?," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 6, pages 1-28.
    28. Xun Cao & Aseem Prakash, 2011. "Growing exports by signaling product quality: Trade competition and the cross‐national diffusion of ISO 9000 quality standards," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 30(1), pages 111-135, December.
    29. Goedhuys, Micheline & Sleuwaegen, Leo, 2013. "The Impact of International Standards Certification on the Performance of Firms in Less Developed Countries," World Development, Elsevier, vol. 47(C), pages 87-101.
    30. Štefan Bojnec & Imre Ferto & József Fogarasi, 2014. "Quality of institutions and the BRIC countries agro-food exports," China Agricultural Economic Review, Emerald Group Publishing, vol. 6(3), pages 379-394, August.
    31. van Bergeijk,Peter A. G. & Brakman,Steven (ed.), 2010. "The Gravity Model in International Trade," Cambridge Books, Cambridge University Press, number 9780521196154, May.
    32. Bojnec, Stefan & Ferto, Imre, 2009. "The Institutional Determinants Of Bilateral Agricultural And Food Trade," APSTRACT: Applied Studies in Agribusiness and Commerce, AGRIMBA, vol. 4(3-4), pages 1-5.
    33. Stefan Ouma, 2010. "Global Standards, Local Realities: Private Agrifood Governance and the Restructuring of the Kenyan Horticulture Industry," Economic Geography, Clark University, vol. 86(2), pages 197-222, April.
    34. Mohammed, Rezgar & Zheng, Yuqing, 2017. "International Diffusion Of Food Safety Standards: The Role Of Domestic Certifiers And International Trade," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 49(02), pages 296-322, May.
    35. Štefan Bojnec & Imre Fertő, 2012. "Does EU Enlargement Increase Agro-Food Export Duration?," The World Economy, Wiley Blackwell, vol. 35(5), pages 609-631, May.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Agribusiness; Agricultural and Food Policy; Food Consumption/Nutrition/Food Safety; International Development; International Relations/Trade;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:gagfdp:275059. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: http://edirc.repec.org/data/iagoede.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.