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Tariff Equivalent of Technical Barriers to Trade with Imperfect Substitution and Trade Costs

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  • Yue, Chengyan
  • Beghin, John C.
  • Jensen, Helen H.

Abstract

The price-wedge method yields a tariff-equivalent estimate of technical barriers to trade (TBT). An extension of this method accounts for imperfect substitution between domestic and imported goods and incorporates recent findings on trade costs. We explore the sensitivity of this revamped TBT estimate to its key determinants (substitution elasticity, preference for home good, and trade cost). We use the augmented approach to investigate the ongoing US-Japan apple trade dispute and find that removing the Japanese TBT would yield limited export gains to the United States. We then draw policy implications of our findings.

Suggested Citation

  • Yue, Chengyan & Beghin, John C. & Jensen, Helen H., 2005. "Tariff Equivalent of Technical Barriers to Trade with Imperfect Substitution and Trade Costs," Staff General Research Papers Archive 12453, Iowa State University, Department of Economics.
    • Handle: RePEc:isu:genres:12453
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • F1 - International Economics - - Trade
    • F18 - International Economics - - Trade - - - Trade and Environment
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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