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Trade Facilitation and Country Size

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    It is argued that compared with large countries, small countries rely more on trade and therefore they are more likely to adopt liberal trading policies. The present paper extends this idea beyond the conventional trade openness measures by analyzing the relationship between country size and the number of documents required to export and import, a measure of trade facilitation. Three important results follow. First, trade facilitation does improve as the country size becomes smaller ; that is, small countries perform better than large countries in terms of trade facilitation. Second, the relationship between country size and trade facilitation is non-linear, much stronger for the relatively small than the large countries. Third, contrary to what the existing studies might suggest, the relationship between country size and trade facilitation does not appear to be driven by the fact that small countries trade more as a proportion of their GDP than the large countries.

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    File URL: ftp://mse.univ-paris1.fr/pub/mse/CES2012/12045.pdf
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    Paper provided by Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne in its series Documents de travail du Centre d'Economie de la Sorbonne with number 12045.

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    Length: 27 pages
    Date of creation: May 2012
    Date of revision:
    Handle: RePEc:mse:cesdoc:12045
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    1. repec:hal:journl:halshs-00717423 is not listed on IDEAS
    2. W. Hertel, Thomas, 2001. "Dynamic Effects of the “New Age” Free Trade Agreement between Japan and Singapore," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 16, pages 446-484.
    3. Djankov, Simeon & Freund, Caroline & Pham, Cong S., 2006. "Trading on time," Policy Research Working Paper Series 3909, The World Bank.
    4. Jamal Ibrahim Haidar, 2012. "The impact of Business Regulatory Reforms on Economic Growth," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00717423, HAL.
    5. Haidar, Jamal Ibrahim, 2009. "Investor protections and economic growth," Economics Letters, Elsevier, vol. 103(1), pages 1-4, April.
    6. Mohammad Amin & Jamal Haidar, 2012. "The cost of registering property: does legal origin matter?," Empirical Economics, Springer, vol. 42(3), pages 1035-1050, June.
    7. Haidar, Jamal Ibrahim, 2012. "The impact of business regulatory reforms on economic growth," Journal of the Japanese and International Economies, Elsevier, vol. 26(3), pages 285-307.
    8. Peter Schwarz, 2007. "Does capital mobility reduce the corporate-labor tax ratio?," Public Choice, Springer, vol. 130(3), pages 363-380, March.
    9. John S. Wilson & Catherine L. Mann & Tsunehiro Otsuki, 2003. "Trade Facilitation and Economic Development: A New Approach to Quantifying the Impact," World Bank Economic Review, World Bank Group, vol. 17(3), pages 367-389, December.
    10. Wacziarg, Romain & Alesina, Alberto, 1998. "Openness, Country Size and Government," Scholarly Articles 4553014, Harvard University Department of Economics.
    11. Wilson,John S. & Mann, Catherine L. & Otsuki, Tsunehiro, 2003. "Trade facilitation and economic development : measuring the impact," Policy Research Working Paper Series 2988, The World Bank.
    12. Caroline L. Freund & Diana Weinhold, 2000. "On the effect of the Internet on international trade," International Finance Discussion Papers 693, Board of Governors of the Federal Reserve System (U.S.).
    13. Caroline Freund & Diana Weinhold, 2002. "The Internet and International Trade in Services," American Economic Review, American Economic Association, vol. 92(2), pages 236-240, May.
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