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A Systematic Approach to Regulatory Heterogeneity Applied to EU Agri-Food Trade

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  • Burnquist, Heloisa Lee
  • Souza, Mauricio Jorge Pinto de
  • Faria, Rosane Nunes de
  • Rau, Marie-Luise
  • Shutes, Karl

Abstract

This paper introduces a methodological framework based on indices for regulatory heterogeneity which is useful to evaluate technical, sanitary and phytosanitary requirements in international agri-food trade. The study uses the index of regulatory heterogeneity in trade (HIT index), constructed to combine binary, ordered and quantitative information, and the index of directional heterogeneity in trade (DHIT), which excludes regulations introduced by importing countries that are less stringent than those in the exporting country. These indices were applied to evaluate the regulatory heterogeneity of MRLs for pesticides under the perspective of the EU. The results indicated that despite of the relatively high number of regulations introduced by the EU for the set of products selected for the analysis, in general, the heterogeneity indices are not higher than 0.6 (on a scale from 0 to 1) for the HIT and are lower than 0.3 for the DHIT, suggesting that most of these regulations are stricter in the EU bloc and are not expected to have a negative impact upon the European exports.

Suggested Citation

  • Burnquist, Heloisa Lee & Souza, Mauricio Jorge Pinto de & Faria, Rosane Nunes de & Rau, Marie-Luise & Shutes, Karl, 2012. "A Systematic Approach to Regulatory Heterogeneity Applied to EU Agri-Food Trade," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126470, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae12:126470
    DOI: 10.22004/ag.econ.126470
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    References listed on IDEAS

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    1. Achterbosch, Thom J. & Engler, Alejandra & Rau, Marie-Luise & Toledo, Roger, 2009. "Measure the measure: the impact of differences in pesticide MRLs on Chilean fruit exports to the EU," 2009 Conference, August 16-22, 2009, Beijing, China 51765, International Association of Agricultural Economists.
    2. Henk Kox & Arjan Lejour, 2005. "Regulatory heterogeneity as obstacle for international services trade," CPB Discussion Paper 49, CPB Netherlands Bureau for Economic Policy Analysis.
    3. Michela Nardo & Michaela Saisana & Andrea Saltelli & Stefano Tarantola & Anders Hoffman & Enrico Giovannini, 2005. "Handbook on Constructing Composite Indicators: Methodology and User Guide," OECD Statistics Working Papers 2005/3, OECD Publishing.
    4. Jane Korinek & Mark Melatos & Marie-Luise Rau, 2008. "A Review of Methods for Quantifying the Trade Effects of Standards in the Agri-Food Sector," OECD Trade Policy Papers 79, OECD Publishing.
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