The perversity of preferences : GSP and developing country trade policies, 1976 - 2000
Industrial countries maintain special tariff preferences, namely the Generalized System of Preferences (GSP), for importsfrom developing countries. Critics have highlighted the underachieving nature of such preferences, but developing countries continue to place the GSP at the heart of their agenda in multilateral negotiations. What effect do such preferences have on a recipient's own trade policies? The authors develop and test a simple theoretical model of a small country's trade policy choice, using a dataset of 154 developing countries from 1976 through 2000. They find that countries removed from the GSP adopt more liberal trade policies than those remaining eligible. The results, corrected for endogeneity and robust to numerous alternative measures of trade policy, suggest that developing countries may be best served by full integration into the reciprocity-based world trade regime rather than continued GSP-style special preferences.
|Date of creation:||31 Jan 2003|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (202) 477-1234
Web page: http://www.worldbank.org/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Blonigen, Bruce A. & Bown, Chad P., 2003.
"Antidumping and retaliation threats,"
Journal of International Economics,
Elsevier, vol. 60(2), pages 249-273, August.
- Douglas Staiger & James H. Stock, 1994.
"Instrumental Variables Regression with Weak Instruments,"
NBER Technical Working Papers
0151, National Bureau of Economic Research, Inc.
- Douglas Staiger & James H. Stock, 1997. "Instrumental Variables Regression with Weak Instruments," Econometrica, Econometric Society, vol. 65(3), pages 557-586, May.
- Krishna, Pravin & Mitra, Devashish, 2005. "Reciprocated unilateralism in trade policy," Journal of International Economics, Elsevier, vol. 65(2), pages 461-487, March.
- John Luke Gallup & Jeffrey D. Sachs & Andrew Mellinger, 1999. "Geography and Economic Development," CID Working Papers 1, Center for International Development at Harvard University.
- Rodríguez, Francisco & Rodrik, Dani, 1999.
"Trade Policy and Economic Growth: A Sceptic's Guide to the Cross-National Evidence,"
CEPR Discussion Papers
2143, C.E.P.R. Discussion Papers.
- Francisco Rodriguez & Dani Rodrik, 2001. "Trade Policy and Economic Growth: A Skeptic's Guide to the Cross-National Evidence," NBER Chapters, in: NBER Macroeconomics Annual 2000, Volume 15, pages 261-338 National Bureau of Economic Research, Inc.
- Francisco Rodriguez & Dani Rodrik, 1999. "Trade Policy and Economic Growth: a Skeptic's Guide to the Cross-National Evidence," Working Papers 9912, Economic Research Forum, revised Apr 1999.
- James M. DeVault, 1996. "Political Pressure and the U.S. Generalized System of Preferences," Eastern Economic Journal, Eastern Economic Association, vol. 22(1), pages 35-46, Winter.
- Dollar, David & Kraay, Aart, 2001.
"Trade, growth, and poverty,"
Policy Research Working Paper Series
2615, The World Bank.
- Whalley, John, 1990. "Non-discriminatory Discrimination: Special and Differential Treatment under the GATT for Developing Countries," Economic Journal, Royal Economic Society, vol. 100(403), pages 1318-28, December.
- Rodrik, Dani, 1995. "Political economy of trade policy," Handbook of International Economics, in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 28, pages 1457-1494 Elsevier.
- Bagwell,K. & Staiger,R.W., 1998.
"An economic theory of GATT,"
15, Wisconsin Madison - Social Systems.
- John H. Jackson, 1997. "The World Trading System, 2nd Edition: Law and Policy of International Economic Relations," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262600277, June.
- Gallup, J.L. & Sachs, J.D. & Mullinger, A., 1999. "Geography and Economic Development," Papers 1, Chicago - Graduate School of Business.
- Arvind Panagariya, 2002.
"Developing Countries at Doha: A Political Economy Analysis,"
The World Economy,
Wiley Blackwell, vol. 25(9), pages 1205-1233, 09.
- Arvind Panagariya, 2003. "Developing Countries at Doha: A Political Economy Analysis," International Trade 0308015, EconWPA.
- Clark, Don P., 1992. "Non-Tariff Measures And Industrial Nation Imports Of Agricultural Products," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 24(01), July.
- Arvind Panagariya, 2002. "EU Preferential Trade Arrangements and Developing Countries," The World Economy, Wiley Blackwell, vol. 25(10), pages 1415-1432, November.
- R. W. Staiger & G. Tabellini, 1999. "Do Gatt Rules Help Governments Make Domestic Commitments?," Economics and Politics, Wiley Blackwell, vol. 11(2), pages 109-144, 07.
- Ray, Edward John, 1987. "The Impact of Special Interests on Preferential Tariff Concessions by the United States," The Review of Economics and Statistics, MIT Press, vol. 69(2), pages 187-93, May.
- André Sapir & Lars Lundberg, 1984.
"The U.S. Generalized System of Preferences and Its Impacts,"
in: The Structure and Evolution of Recent U.S. Trade Policy, pages 195-236
National Bureau of Economic Research, Inc.
- André Sapir & Lars Lundberg, 1984. "The U.S. generalized system of preferences and its impacts," ULB Institutional Repository 2013/8270, ULB -- Universite Libre de Bruxelles.
- Coates, Daniel E. & Ludema, Rodney D., 2001. "A theory of trade policy leadership," Journal of Development Economics, Elsevier, vol. 65(1), pages 1-29, June.
- Raymond Vreeland, James, 2002. "The Effect of IMF Programs on Labor," World Development, Elsevier, vol. 30(1), pages 121-139, January.
- Brown, Drusilla K, 1989. "Trade and Welfare Effects of the European Schemes of the Generalized System of Preferences," Economic Development and Cultural Change, University of Chicago Press, vol. 37(4), pages 757-77, July.
- Hoekman, Bernard & Michalopoulos, Constantine & Winters, L. alan, 2003. "More favorable and differential treatment of developing countries : toward a new approach in the World Trade Organization," Policy Research Working Paper Series 3107, The World Bank.
- Baier, Scott L. & Bergstrand, Jeffrey H., 2001. "The growth of world trade: tariffs, transport costs, and income similarity," Journal of International Economics, Elsevier, vol. 53(1), pages 1-27, February.
When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:2955. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi)
If references are entirely missing, you can add them using this form.