Measuring the Effects and Evolution of Non-tariff Measures

Yuting Gao ()
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Yuting Gao: Indiana University, Department of Economics

CAEPR Working Papers from Center for Applied Economics and Policy Research, Department of Economics, Indiana University Bloomington

Abstract: How do Non-tariff Measures (NTMs) affect trade flows, and how do these effects evolve over time? I estimate and compare the trade effects for 6 types of NTMs over 15 years. I construct a dataset of import flows and trade policies for 110 countries and 96 HS2 level products. I use poisson pseudo-maximum likelihood to estimate structural gravity model during 2000-2015. The main results are that when measured by ad valorem equivalents, both implementation effects and marginal effects of NTMs converge to 0 over time. On the one hand, this pattern is good for countries seeking to impose more NTMs out of non-protective purpose, because they will face less distortions brought by the NTMs on import flows. On the other hand, this pattern hurts the countries seeking to impose more protective measures, because the NTMs are losing the power to effectively restrict imports.

Keywords: non-tariff measures; ad valorem equivalents; gravity model (search for similar items in EconPapers)
Pages: 27 pages
Date: 2022-04
New Economics Papers: this item is included in nep-int
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Persistent link: https://EconPapers.repec.org/RePEc:inu:caeprp:2022007

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