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Complements or Substitutes?: Preferential and Multilateral Trade Liberalization at the Sectoral Level

Author

Listed:
  • Estevadeordal, Antoni
  • Volpe Martincus, Christian
  • Ando, Mitsuyo

Abstract

This paper explores the relationship between preferential and multilateral trade liberalization at the sectoral level using a unique dataset that includes data on most favored nation (MFN) and bilateral preferential tariffs at the 4-digit ISIC level for 11 Latin American countries over the period 1985¿2005. We find evidence of heterogeneity across sectors. While in some industries, complementary effects between both kinds of trade liberalization are observed, in others no significant links are detected and¿in a few cases¿even substitutability seems to prevail. Variation across sectors appears to be systematically related to both import demand elasticities and countries¿ sectoral comparative advantages.

Suggested Citation

  • Estevadeordal, Antoni & Volpe Martincus, Christian & Ando, Mitsuyo, 2009. "Complements or Substitutes?: Preferential and Multilateral Trade Liberalization at the Sectoral Level," IDB Publications (Working Papers) 2550, Inter-American Development Bank.
    • Handle: RePEc:idb:brikps:2550
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    Cited by:

    1. Richard Pomfret, 2013. "ASEAN's New Frontiers: Integrating the Newest Members into the ASEAN Economic Community," Asian Economic Policy Review, Japan Center for Economic Research, vol. 8(1), pages 25-41, June.
    2. repec:awd:intstu:v:18:y:2018:i:1-2:p:49-64 is not listed on IDEAS
    3. Richard Pomfret & Uwe Kaufmann & Christopher Findlay, 2010. "Are Preferential Tariffs Utilized? Evidence from Australian Imports, 2000-9," School of Economics and Public Policy Working Papers 2010-13, University of Adelaide, School of Economics and Public Policy.

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    Keywords

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    JEL classification:

    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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