NTMs, Preferential Trade Agreements, and Prices: New evidence

Olivier Cadot and Julien Gourdon

No 10798, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: This paper combines price data from the CEPII bilateral Unit Values with a new database on non-tariff measures (NTMs) to estimate their effect on consumer prices for selected 4500 products in 60 countries. Results based on panel regressions on 270,000 country-product pairs suggest that, after controlling for tariffs, systematic cross-country cost-of-living and factor endowment differences, origin country-specific and product-specific unobservables, NTMs increase trade unit values in two thirds of the product lines. However, we also find that, in Preferential Trade Agreements (PTA) with deep-integration clauses, harmonization and mutual recognition of standards or conformity assessment substantially reduce the this price-raising effect, suggesting that the compliance-cost component of the price rise is reduced by ?deep integration? clauses in PTAs.

Keywords: Ad-valorem equivalents; Economic integration agreement; Free-trade agreements; Harmonization; Non-tariff measures; Regionalism; Trade (search for similar items in EconPapers)
JEL-codes: F13 F15 O19 (search for similar items in EconPapers)
Date: 2015-08
New Economics Papers: this item is included in nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Related works:
Journal Article: Non-tariff measures, preferential trade agreements, and prices: new evidence (2016)
Working Paper: NTMs, Preferential Trade Agreements, and Prices: New evidence (2015)
Working Paper: NTMs, Preferential Trade Agreements, and Prices: New evidence (2015)
Working Paper: NTMs, Preferential Trade Agreements, and Prices: New evidence (2015)
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