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Effects of the multifibre arrangement on developing countries'trade : an empirical investigation


  • Erzan, Refik
  • Goto, Junichi
  • Holmes, Paula


This paper addresses two issues: (i) the extent of the restrictiveness/effectiveness of the Multifibre Arrangement (MFA) with respect to the developing country suppliers of textile products during the 1980s, and (ii) the extent to which these restrictions yield trade gains for the less established developing suppliers. After analyzing data, the author's made the following conclusions. Rather than ease up, the MFA became more restrictive. Proportionately more shipments were subject to quotas and volume generally grew less where quotas were binding. The unit value of shipments subject to binding quotas also increased substantially more than the unit value of unconstrained items. Developing countries that were new exporters of textile products also hoped to capture a larger share of the textile market as a result of quotas for other developing countries. However, the needy countries have benefited little from the MFA, and countries whose exports grow soon find themselves on the restricted list. Finally, domestic producers in the United States have benefited most from the MFA.

Suggested Citation

  • Erzan, Refik & Goto, Junichi & Holmes, Paula, 1989. "Effects of the multifibre arrangement on developing countries'trade : an empirical investigation," Policy Research Working Paper Series 297, The World Bank.
  • Handle: RePEc:wbk:wbrwps:297

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    References listed on IDEAS

    1. Trela, I. & Whalley, J., 1988. "Do Developing Countries Lose From The Mfa?," University of Western Ontario, The Centre for the Study of International Economic Relations Working Papers 8804c, University of Western Ontario, The Centre for the Study of International Economic Relations.
    2. Trela, I. & Whalley, J., 1989. "Unravelling The Threads Of The Mfa," Papers 448, Stockholm - International Economic Studies.
    3. Goto, Junichi, 1988. "Effects of the multifibre arrangement on developing countries : a survey," Policy Research Working Paper Series 102, The World Bank.
    4. Hamilton, Carl, 1986. "An Assessment of Voluntary Restraints on Hong Kong Exports to Europe and the USA," Economica, London School of Economics and Political Science, vol. 53(211), pages 339-350, August.
    5. repec:wsi:wschap:9789813108448_0025 is not listed on IDEAS
    6. David G. Tarr, 2017. "Effects of Restraining Steel Exports from the Republic of Korea and Other Countries to the United States and the European Economic Community," World Scientific Book Chapters,in: Trade Policies for Development and Transition, chapter 25, pages 595-616 World Scientific Publishing Co. Pte. Ltd..
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    Cited by:

    1. J. Michael Finger & Ann Harrison, 1996. "The MFA Paradox: More Protection and More Trade?," NBER Chapters,in: The Political Economy of American Trade Policy, pages 197-260 National Bureau of Economic Research, Inc.
    2. Safadi, Raed & Laird, Sam, 1996. "The Uruguay Round agreements: Impact on developing countries," World Development, Elsevier, vol. 24(7), pages 1223-1242, July.
    3. Erzan, Refik & Holmes, Paula, 1990. "An evaluation of the main elements in the leading proposals to phase out the Multi-Fibre Arrangement," Policy Research Working Paper Series 483, The World Bank.
    4. Riccardo Faini & Jaime Melo & Wendy Takacs, 1995. "A Primer on the MFA Maze," The World Economy, Wiley Blackwell, vol. 18(1), pages 113-135, January.
    5. Hanaa Kheir- El- Din & M. Maamoun Abdel- Fattah, 2000. "Textiles and Clothing in the Mediterranean Region: Opportunities and Challenges of Returning Textiles and Clothing to GATT Disciplines," Working Papers 2008, Economic Research Forum, revised 03 Sep 2000.
    6. Cabalu, Helen, 1995. "Modeling the Effects of the MFA Liberalization on Philippine Clothing Trade," Philippine Journal of Development JPD 1995 Vol. XXII No. 1-, Philippine Institute for Development Studies.
    7. Laird, Samuel, 1992. "Non-tariff measures in hemispheric FTA negotiations," Sede de la CEPAL en Santiago (Estudios e Investigaciones) 33909, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    8. Spinanger, Dean, 1994. "Profiting from protection in an open economy: Hong Kong's supply response to EU's MFA restrictions," Kiel Working Papers 653, Kiel Institute for the World Economy (IfW).
    9. Ben Bassem, 2009. "The Impact of the Removal of the Multi-Fiber Arrangements on Tunisian Textile and Clothing Exports," Transition Studies Review, Springer;Central Eastern European University Network (CEEUN), vol. 16(1), pages 206-219, May.


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