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NTMs, Preferential Trade Agreements, and Prices: New evidence

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  • Cadot, Olivier

Abstract

Combining for the first time a new dataset of non-tariff measures (NTMs) in 65 countries with the CEPII’s unit values database, we estimate average ad-valorem equivalents (AVEs) for SPS, TBT and other measures by section of the Harmonized System of product classification. While most existing AVEs are obtained from indirect quantity-based estimation, ours are obtained from direct price-gap estimation. They lie in a single-digit range, i.e. substantially lower than previous estimates based on older data. Our results may reflect the progressive phasing out of commandand- control instruments such as quantitative restrictions in many countries; they also suggest that sanitary and technical regulations have not substituted for them as trade-restrictive interventions. Most interestingly, we show that deep-integration clauses in regional trade agreements, in particular the mutual recognition of conformity-assessment procedures, substantially reduce the price-raising effect of NTMs, possibly reflecting lower compliance costs.

Suggested Citation

  • Cadot, Olivier, 2015. "NTMs, Preferential Trade Agreements, and Prices: New evidence," Papers 807, World Trade Institute.
  • Handle: RePEc:wti:papers:807
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Mahdi Ghodsi & Julia Grübler & Oliver Reiter & Robert Stehrer, 2017. "The Evolution of Non-Tariff Measures and their Diverse Effects on Trade," wiiw Research Reports 419, The Vienna Institute for International Economic Studies, wiiw.
    2. Giorgio Barba Navaretti & Giulia Felice & Emanuele Forlani & Paolo Garella, 2018. "Non-tariff measures and competitiveness," Development Working Papers 438, Centro Studi Luca d'Agliano, University of Milano, revised 12 Sep 2018.
    3. repec:ksp:journ1:v:4:y:2017:i:3:p:263-274 is not listed on IDEAS
    4. John C. Beghin & Bo Xiong, 2016. "Economic Effects of Standard-Like Nontariff Measures: Analytical and Methodological Dimensions," Center for Agricultural and Rural Development (CARD) Publications 16-wp569, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    5. 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.
    6. Lili Yan ING & Olivier CADOT, 2017. "Remaking Ad valorem equivalents of non-tariff measures in ASEAN," Working Papers DP-2017-09, Economic Research Institute for ASEAN and East Asia (ERIA).
    7. Knobel, Alexander (Кнобель, Александр) & Baeva, Marina (Баева, Марина), 2017. "Protective Measures in Integration Agreements and Their Impact on Mutual Trade and Trade with Third Countries: Features of Russia and the Countries of the Eurasian Economic Union
      [Защитные Меры В И
      ," Working Papers 051735, Russian Presidential Academy of National Economy and Public Administration.
    8. Olivier CADOT & Lili Yan ING, 2017. "Ad-valorem equivalents of NTMs in ASEAN," Working Papers P203, FERDI.
    9. John C. Beghin & Bo Xiong, 2016. "Economic Effects of Standard-Like Nontariff Measures: Analytical and Methodological Dimensions," Center for Agricultural and Rural Development (CARD) Publications 16-wp569, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    10. repec:eco:journ1:2019-03-25 is not listed on IDEAS
    11. repec:acl:journl:y::id:118 is not listed on IDEAS

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    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration

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