Reassessing effective protection rates in a trade in tasks perspective: Evolution of trade policy in "Factory Asia"
International trade moved from "trade in goods" to "trade in tasks" and effective protection rates (EPRs) are back to the analytical stage. They measure the overall protection that sectoral value-added is receiving from applied tariffs. The paper calculates sectorial EPRs for 10 Asian-Pacific countries between 1995 and 2005 and proposes simple methods aimed at isolating the specific contribution of changes in tariff policies, in production structure or in real exchange rates. International input-output matrices allowed also to compute and compare the average propagation length of a shock linked to a sudden change in tariff duties, identifying sectors most deeply interconnected.
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