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Product Standards, Trade Disputes and Protectionism

  • Daniel M. Sturm

Trade disputes over national product standards are a growing source of tension in the international trading system. The usual pattern is that a country introduces a new product standard for all sales of a good in its local market, which is justified as necessary for consumer or environmental protection. Importers into the local market, however, challenge the standard as a 'disguised barrier to trade' or 'green protectionism'. The paper develops a two country political economy model to explain such disputes. It is shown how the political process can lead to a 'political failure' which takes the form of either too many or too few product standards and disagreement between politicians in different countries over the optimal policy. In a second step the model is used to evaluate whether two common proposals to settle or avoid such disputes, mutual recognition of standards and harmonization, can improve the political process.

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File URL: http://cep.lse.ac.uk/pubs/download/DP0486.pdf
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Paper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp0486.

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Date of creation: Jan 2001
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Handle: RePEc:cep:cepdps:dp0486
Contact details of provider: Web page: http://cep.lse.ac.uk/_new/publications/series.asp?prog=CEP

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  1. Stephen Nickell & Patricia Jones & Glenda Quintini, 2002. "A Picture of Job Insecurity Facing British Men," Economic Journal, Royal Economic Society, vol. 112(476), pages 1-27, January.
  2. Simon Burgess & H Turon, 2000. "Unemployment Dynamics, Duration and Equilibrium: Evidence from Britain," CEP Discussion Papers dp0474, Centre for Economic Performance, LSE.
  3. Timothy Besley & Anne Case, 1993. "Does Electoral Accountability Affect Economic Policy Choices? Evidence from Gubernatorial Term Limits," NBER Working Papers 4575, National Bureau of Economic Research, Inc.
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