Services Trade Policies and Economic Integration: New Evidence for Developing Countries

Ben Shepherd
Authors registered in the RePEc Author Service: Bernard Hoekman

No 14181, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This paper provides the first quantitative evidence on the restrictiveness of services policies in 2016 for a sample of developing countries, based on recently released regulatory data collected by the World Bank and WTO. We use machine learning to recreate to a high degree of accuracy the OECD’s Services Trade Restrictiveness Index (STRI), which takes account of nonlinearities and dependencies across measures. We use the resulting estimates to extend the OECD STRI approach to 23 additional countries, producing what we term a Services Policy Index (SPI). Converting the SPI to ad valorem equivalent terms shows that services policies are typically much more restrictive than tariffs on imports of goods, in particular in professional services and telecommunications. Developing countries tend to have higher services trade restrictions, but less so than has been found in research using data for the late 2000s. We show that the SPI has strong explanatory power for bilateral trade in services at the sectoral level, as well as for aggregate goods and services trade.

Keywords: International trade; Trade in services; Machine learning; Services policies; Restrictiveness indicators (search for similar items in EconPapers)
JEL-codes: F13 F15 O24 (search for similar items in EconPapers)
Date: 2019-12
New Economics Papers: this item is included in nep-big, nep-cmp and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Services Trade Policies and Economic Integration: New Evidence for Developing Countries (2021)
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