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How much do agreements matter for services trade?

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  • Shingal, ANIRUDH

Abstract

With an increasing number of Preferential Trade Agreements (PTAs) covering trade in services, we explore the impact of PTAs on services trade. To the best of our knowledge, this is the first paper in this literature that endogenizes the impact of preferentialism in estimating the trade effect. We also add to this literature by distilling the trade effect of PTAs into that emanating from services and “goods only” agreements and further confirm complementarities between the two. Moreover, we study these relationships disaggregated by the economic status of the partner countries and by the reciprocity of commitments. Our results suggest trade effects of 11.6 – 12.7% from having a services accord alone. They also reveal that the underlying services trade between countries has been driven as much by IRS as by factor differences and that asymmetric trade alliance between North-South partners has been successful in fostering inter-industry trade.

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  • Shingal, ANIRUDH, 2009. "How much do agreements matter for services trade?," MPRA Paper 32815, University Library of Munich, Germany, revised 15 May 2010.
    • Handle: RePEc:pra:mprapa:32815
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    Cited by:

    1. Blyde, Juan S. & Volpe Martincus, Christian & Molina, Danielken, 2014. "Fábricas sincronizadas: América Latina y el Caribe en la era de las Cadenas Globales de Valor," IDB Publications (Books), Inter-American Development Bank, number 6668.
    2. Erik Marel & Ben Shepherd, 2013. "Services Trade, Regulation and Regional Integration: Evidence from Sectoral Data," The World Economy, Wiley Blackwell, vol. 36(11), pages 1393-1405, November.
    3. Sèna Kimm Gnangnon & Shishir Priyadarshi, 2016. "Export Product Diversification, Services Production and Exports in Least Developed Countries," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 7(03), pages 1-36, October.
    4. Egger, Peter & MILE 02, Anirudh Shingal, 2014. "Determinants of services trade agreements," Papers 721, World Trade Institute.
    5. van der Marel, Erik, 2011. "Determinants of comparative advantage in services," LSE Research Online Documents on Economics 38993, London School of Economics and Political Science, LSE Library.
    6. Sauvé, Pierre & Shingal, Anirudh, 2014. "Why do Countries enter into Preferential Agreements on Trade in Services? Assessing the Potential for Negotiated Regulatory Convergence in Asian Services Markets," Working Papers on Regional Economic Integration 129, Asian Development Bank.
    7. Sahoo, Pravakar & Dash, Ranjan Kumar, 2014. "India's surge in modern services exports: Empirics for policy," Journal of Policy Modeling, Elsevier, vol. 36(6), pages 1082-1100.
    8. Bianka Dettmer, 2012. "The European Union's service directive: Contrasting ex ante estimates with empirical evidence," Jena Economics Research Papers 2012-019, Friedrich-Schiller-University Jena.
    9. Har Sandeep Kaur, 2016. "Services Exports and SAARC Countries: A Comparative Analysis of Growth, Performance and Competitive Advantage," Millennial Asia, , vol. 7(1), pages 20-41, April.
    10. Gnangnon, Sèna Kimm, 2020. "Aid for Trade and Services Export Diversification in Recipient-Countries," EconStor Preprints 210467, ZBW - Leibniz Information Centre for Economics.
    11. Sèna K. Gnangnon, 2021. "Aid for Trade and services export diversification in recipient countries," Australian Economic Papers, Wiley Blackwell, vol. 60(2), pages 189-225, June.
    12. Nianli Zhou & John Whalley, 2014. "How Do the "GATS-Plus" and "GATS-Minus" Characteristics of Regional Service Agreements Affect Trade in Services?," NBER Working Papers 20551, National Bureau of Economic Research, Inc.
    13. MILE 02, Anirudh Shingal, 2014. "Exploring complementarities between goods and services trade in trade agreements," Papers 834, World Trade Institute.
    14. Rupa Chanda, 2014. "Introduction," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 5(01), pages 1-14.
    15. Shingal, Anirudh, 2013. "Revisiting the trade effects of services agreements," MPRA Paper 51243, University Library of Munich, Germany.
    16. Pravakar Sahoo & Ranjan Kumar Dash, 2017. "What Drives India's Surge in Service Exports?," The World Economy, Wiley Blackwell, vol. 40(2), pages 439-461, February.
    17. Juan S. Blyde & Christian Volpe Martincus & Danielken Molina, 2014. "Fábricas sincronizadas: América Latina y el Caribe en la era de las Cadenas Globales de Valor," IDB Publications (Books), Inter-American Development Bank, number 86755 edited by Juan S. Blyde, February.
    18. Arti Grover Goswami & Sebastián Sáez, 2014. "Trade in services competitiveness: An assessment methodology," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 5(01), pages 1-31.
    19. Egger, Peter & Larch, Mario & Staub, Kevin E, 2012. "Trade Preferences and Bilateral Trade in Goods and Services: A Structural Approach," CEPR Discussion Papers 9051, C.E.P.R. Discussion Papers.

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    More about this item

    Keywords

    Services trade; RTAs; gravity model; endogeneity; North-South;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F10 - International Economics - - Trade - - - General

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