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Information Cost: A Prior Hurdle to Exporting

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  • Wei, Xuan
  • Thornsbury, Suzanne

Abstract

This paper empirically investigates how information cost, as part of trade costs, affects the decision of an individual firm to export. We use cross section firm-level data to examine how the difficulty of obtaining information on technical regulations in the European Union (EU) and the United States actually reduces firm incentives to export to these two destinations. Results suggest that increased information cost significantly reduces the probability of exporting for an individual firm, beyond tariff and other nontariff barriers.

Suggested Citation

  • Wei, Xuan & Thornsbury, Suzanne, 2009. "Information Cost: A Prior Hurdle to Exporting," 2009 Conference, August 16-22, 2009, Beijing, China 51745, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae09:51745
    DOI: 10.22004/ag.econ.51745
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    References listed on IDEAS

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    1. Disdier, Anne-Celia & Fontagne, Lionel & Mimouni, Mondher, 2008. "AJAE Appendix: The Impact of Regulations on Agricultural Trade: Evidence from the SPS and TBT Agreements," American Journal of Agricultural Economics APPENDICES, Agricultural and Applied Economics Association, vol. 90(2), pages 1-7.
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    3. Chengyan Yue & John Beghin & Helen H. Jensen, 2017. "Tariff Equivalent Of Technical Barriers To Trade With Imperfect Substitution And Trade Costs," World Scientific Book Chapters, in: John Christopher Beghin (ed.), Nontariff Measures and International Trade, chapter 9, pages 151-164, World Scientific Publishing Co. Pte. Ltd..
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    8. Philip L. Paarlberg & John G. Lee, 1998. "Import Restrictions in the Presence of a Health Risk: An Illustration Using FMD," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 175-183.
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