Disentangling the Demand-enhancing Effect and Trade-cost Effect of Technical Measures in Agricultural Trade among OECD countries

Bo Xiong () and John Beghin ()

No 116898, 2011: Agricultural Price Volatility, Trade Policy and Food Security in Developing Countries, December 2011, St. Petersburg, Florida from International Agricultural Trade Research Consortium

Abstract: Domestic technical measures such as SPS and TBTs can enhance import demand via information disclosure and quality improvement, or hamper foreign export supply via imposing sizeable compliance costs, or both. The traditional gravity equation model estimates the net effect of these measures on international trade with a loss of useful inference on separate effects. We stipulate a generalized gravity equation model to disentangle the two effects. We apply the augmented approach to agricultural trade among OECD countries in 2004. We find that technical measures in agriculture often jointly enhance import demand and hinder export supply with the net effect of promoting the propensity to trade. Further disaggregated data analysis reveals heterogeneity across sectors in terms of net effects of technical measures, despite common demand-enhancing and supply-hindering effects. These measures in the net decrease the probability of intra-OECD trade in dairy products, whereas they increase that of intra-OECD trade in cereal preparations.

Keywords: International; Relations/Trade (search for similar items in EconPapers)
Pages: 41
Date: 2011
New Economics Papers: this item is included in nep-agr and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
https://ageconsearch.umn.edu/record/116898/files/AgEcon_Disentangling.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:iatr11:116898

DOI: 10.22004/ag.econ.116898

Access Statistics for this paper

More papers in 2011: Agricultural Price Volatility, Trade Policy and Food Security in Developing Countries, December 2011, St. Petersburg, Florida from International Agricultural Trade Research Consortium Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().