Does the Elimination of Export Requirements in Special Economic Zones affect Export Performance? Evidence from the Dominican Republic

Fabrice Defever, José-Daniel Reyes, Alejandro Riaño and Miguel Eduardo Sánchez-Martín

No 2016-18, Discussion Papers from University of Nottingham, GEP

Abstract: Special economic zones, one of the most important instruments of industrial policy in developing countries, often feature export share requirements. That is, firms located in these zones are obliged to export more than a certain stated share of their output to enjoy the wide array of incentives available there, a practice prohibited by the World Trade Organization. This paper exploits the staggered removal of export requirements across products and over time in the special economic zones of the Dominican Republic to evaluate whether the importance of exports originating from the zones was affected by the elimination of export requirements. The findings show that entry increased among firms in special economic zones, while the average value of export transactions fell for existing exporters following the reforms. At the same time, continuous exporters were unaffected by the policy change, possibly because these firms were not constrained by the export requirement. Overall, special economic zones became more important with respect to the number of exporters based there but not in terms of the value of exports. The findings suggest that the elimination of performance requirements made it more attractive for firms to be based in special economic zones.

Keywords: Special Economic Zones; Export Share Requirements; Export Subsidies; Dominican Republic; Agreement on Subsidies and Countervailing Measures. (search for similar items in EconPapers)
Date: 2016
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 (6)

Downloads: (external link)
https://www.nottingham.ac.uk/gep/documents/papers/2016/2016-18.pdf (application/pdf)

Related works:
Working Paper: Does the Elimination of Export Requirements in Special Economic Zones A ect Export Performance? Evidence from the Dominican Republic (2016)
Working Paper: Does the elimination of export requirements in special economic zones affect export performance? evidence from the Dominican Republic (2016)
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:not:notgep:16/18

Access Statistics for this paper

More papers in Discussion Papers from University of Nottingham, GEP School of Economics University of Nottingham University Park Nottingham NG7 2RD. Contact information at EDIRC.
Bibliographic data for series maintained by Hilary Hughes ().