IDEAS home Printed from https://ideas.repec.org/p/wbk/wbrwps/4390.html
   My bibliography  Save this paper

Product standards, harmonization, and trade : evidence from the extensive margin

Author

Listed:
  • Shepherd, Ben

Abstract

The author uses a new database of EU product standards in the textiles, clothing, and footwear sectors to present the first empirical evidence that international standards harmonization is associated with increased partner country export variety. A 10 percentage point increase in the proportion of internationally harmonized standards is associated with a 0.2 percent increase in partner country export variety, whereas a 10 percent increase in the total number of standards is associated with a nearly 6 percent decrease in product variety. Although small, the harmonization elasticity is statistically significant, and proves highly robust to sample changes and instrumental variables estimation using instruments motivated by political economy considerations. Moreover, it is found to be around 50 percent higher for low income countries, which suggests that they may be particularly constrained in adapting products to meet multiple standards. Numerical simulations show that these findings are consistent with a heterogeneous firms model of trade in which harmonization is beneficial at the extensive margin provided that any increases in compliance costs are not too large.

Suggested Citation

  • Shepherd, Ben, 2007. "Product standards, harmonization, and trade : evidence from the extensive margin," Policy Research Working Paper Series 4390, The World Bank.
  • Handle: RePEc:wbk:wbrwps:4390
    as

    Download full text from publisher

    File URL: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2007/11/12/000158349_20071112095628/Rendered/PDF/wps4390.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Krueger, Anne O & Tuncer, Baran, 1982. "An Empirical Test of the Infant Industry Argument," American Economic Review, American Economic Association, vol. 72(5), pages 1142-1152, December.
    2. Balassa, Bela, 1978. "Exports and economic growth : Further evidence," Journal of Development Economics, Elsevier, vol. 5(2), pages 181-189, June.
    3. Andrew M. Watson & Joel B. Dirlam, 1965. "The Impact of Underdevelopment on Economic Planning," The Quarterly Journal of Economics, Oxford University Press, vol. 79(2), pages 167-194.
    4. Thomas,Vinod, 1989. "Developing country experience in trade reform," Policy Research Working Paper Series 295, The World Bank.
    5. Laird, Sam & Nogues, Julio, 1988. "Trade policies and the debt crisis," Policy Research Working Paper Series 99, The World Bank.
    6. Romer,Paul M, 1989. "What determines the rate of growth and technological change?," Policy Research Working Paper Series 279, The World Bank.
    7. Feder, Gershon, 1983. "On exports and economic growth," Journal of Development Economics, Elsevier, vol. 12(1-2), pages 59-73.
    8. Hill, Hal, 1982. "State enterprises in a competitive industry: An Indonesian case study," World Development, Elsevier, vol. 10(11), pages 1015-1023, November.
    9. Nishimizu, Mieko & Robinson, Sherman, 1984. "Trade policies and productivity change in semi-industrialized countries," Journal of Development Economics, Elsevier, vol. 16(1-2), pages 177-206.
    10. Balassa, Bela, 1988. "Public finance and economic development," Policy Research Working Paper Series 31, The World Bank.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Munasib, Abdul B.A. & Roy, Devesh, 2011. "Nontariff Barriers as Bridge to Cross," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 125025, International Association of Agricultural Economists.
    2. Clougherty, Joseph A. & Grajek, Michał, 2014. "International standards and international trade: Empirical evidence from ISO 9000 diffusion," International Journal of Industrial Organization, Elsevier, vol. 36(C), pages 70-82.
    3. Ferrantino, Michael J., 2012. "Using supply chain analysis to examine the costs of non-tariff measures (NTMs) and the benefits of trade facilitation," WTO Staff Working Papers ERSD-2012-02, World Trade Organization (WTO), Economic Research and Statistics Division.
    4. repec:ksp:journ1:v:4:y:2017:i:3:p:263-274 is not listed on IDEAS
    5. Ingo Borchert & Batshur Gootiiz & Aaditya Mattoo, 2014. "Policy Barriers to International Trade in Services: Evidence from a New Database," World Bank Economic Review, World Bank Group, vol. 28(1), pages 162-188.
    6. Mukim, Megha, 2012. "Geography and exporting behavior : evidence from India," Policy Research Working Paper Series 5979, The World Bank.
    7. Reyes, Jose-Daniel, 2011. "International harmonization of product standards and firm heterogeneity in international trade," Policy Research Working Paper Series 5677, The World Bank.
    8. De, Prabir & Raihan, Selim & Kathuria, Sanjay, 2012. "Unlocking Bangladesh-India trade : emerging potential and the way forward," Policy Research Working Paper Series 6155, The World Bank.
    9. Foletti, Liliana & Shingal, Anirudh, 2014. "Trade effects of MRL harmonization in the EU," Papers 720, World Trade Institute.
    10. Eyal RONEN, 2017. "Quantifying the trade effects of NTMs: A review of the empirical literature," Journal of Economics and Political Economy, KSP Journals, vol. 4(3), pages 263-274, September.
    11. Olper, Alessandro & Curzi, Daniele & Pacca, Lucia, 2014. "Do food standards affect the quality of EU imports?," Economics Letters, Elsevier, vol. 122(2), pages 233-237.
    12. Wilson, Norbert L. W., 2017. "Labels, Food Safety, and International Trade," ADBI Working Papers 657, Asian Development Bank Institute.
    13. Hoda El-Enbaby & Rana Hendy & Chahir Zaki, 2014. "Do Product Standards Matter for Margins of Trade In Egypt? Evidence from Firm-Level Data," Working Papers 840, Economic Research Forum, revised Jun 2014.
    14. Munasib, Abdul & Roy, Devesh, 2011. "Sanitary and phytosanitary standards as bridge to cross:," IFPRI discussion papers 1140, International Food Policy Research Institute (IFPRI).
    15. Foletti, Liliana & Shingal, Anirudh, 2014. "Stricter regulation boosts exports: the case of Maximum Residue Levels in pesticides," MPRA Paper 59895, University Library of Munich, Germany.
    16. Olayinka Idowu Kareem, 2014. "The European Union Sanitary and Phytosanitary Measures and Africa’s Exports," RSCAS Working Papers 2014/98, European University Institute.
    17. Ederington,Josh & Ruta,Michele, 2016. "Non-tariff measures and the world trading system," Policy Research Working Paper Series 7661, The World Bank.

    More about this item

    Keywords

    Housing&Human Habitats; E-Finance and E-Security; Educational Technology and Distance Education; Mining&Extractive Industry (Non-Energy); E-Business;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:4390. 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). General contact details of provider: http://edirc.repec.org/data/dvewbus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.