IDEAS home Printed from https://ideas.repec.org/p/wbk/wbrwps/9438.html
   My bibliography  Save this paper

Risk Management in Border Inspection

Author

Listed:
  • Hillberry,Russell Henry
  • Karabay,Bilgehan
  • Tan,Shawn Weiming

Abstract

As part of their commitments under the World Trade Organization's Agreement on Trade Facilitation, many developing countries are set to adopt risk management, a strategy for selecting import shipments for inspection. This paper formalizes key enforcement issues related to risk management. It argues that the complexities of international trade oversight mean that inspecting agencies lack certainty about the conditional probability that a given shipment will not comply with import regulations. Ambiguity of this sort is likely to be especially important in developing countries that lack the sophisticated information technology used in advanced risk management systems. This paper formalizes a role for ambiguity in a theoretical model of border inspection. It provides evidence suggesting that ambiguity affects inspection rates. Finally, the paper calibrates the model and shock the ambiguity parameters to illustrate the consequences of an information technology-driven improvement in risk management capabilities for equilibrium rates of search and compliance.

Suggested Citation

  • Hillberry,Russell Henry & Karabay,Bilgehan & Tan,Shawn Weiming, 2020. "Risk Management in Border Inspection," Policy Research Working Paper Series 9438, The World Bank.
  • Handle: RePEc:wbk:wbrwps:9438
    as

    Download full text from publisher

    File URL: http://documents.worldbank.org/curated/en/816841602688697224/pdf/Risk-Management-in-Border-Inspection.pdf
    Download Restriction: no
    ---><---

    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:9438. 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: . General contact details of provider: https://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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Roula I. Yazigi (email available below). General contact details of provider: https://edirc.repec.org/data/dvewbus.html .

    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.