Did the least developed countries benefit from duty-free quota-free access to the Japanese market?

Ito Tadashi

No 434, IDE Discussion Papers from Institute of Developing Economies, Japan External Trade Organization(JETRO)

Abstract: Countries classified as least developed countries (LDCs) were granted duty-free quota-free (DFQF) access to the Japanese market. This study examines the impact of that access and finds that, in general, it did not benefit the LDCs. The construction of concordance tables for Japan's 9 digit tariff line codes enables analysis at the tariff line level, which overcomes a possible aggregation bias. The exogenous nature of DFQF access mitigates the endogeneity problem. Various estimation models, including the triple difference estimator, show that in general the LDCs did not benefit from DFQF access to the Japanese market. The total value of imports from LDCs has been increasing, but the imports granted both zero tariffs and substantial preference margins over non-LDC countries were not successful. These findings suggest that for LDCs the tariff barrier is a relatively small obstacle: Trade is affected more strongly by other factors, such as infrastructure, nontariff barriers, geographic distance, and cultural differences.

Keywords: Developing countries; Japan; International trade; Trade policy; Foreign investments; Tariff; Export platform FDI (search for similar items in EconPapers)
JEL-codes: F12 F13 F15 (search for similar items in EconPapers)
Date: 2013-12-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published in IDE Discussion Paper = IDE Discussion Paper, No. 434. 2013-12-01

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