Gravity estimation of non tariff measures (NTMs) on EU-USA agri-food trade: Implications for further analysis

Ana I. Sanjuán, George Philippidis and Helena Resano

No 332375, Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project

Abstract: This year marks the formal opening of trade negotiations between the world's two largest trading partners – the European Union (EU) and the United States of America (USA). It is expected that the transatlantic partnership negotiations will face significant obstacles on both sides, which in turn places the burden on economists to provide plausible impact assessments to inform policy makers. Unfortunately, modelling databases whilst rich with detailed disaggregated representations of tariff barriers, still underperform in the case of nontariff measure counterparts. Indeed, unlike conventional tariff measures, NTMs do not have a transparent price effect which can be readily inserted into an economic model. Over the last decade, the usage of gravity models has received recognition as one such tool for understanding the 'part-worth' of NTM measures on trade restrictiveness. This paper also employs a gravity approach, whilst the explorative nature of the research restricts the current focus to four agro-food sectors. Preliminary results suggest that NTMs impose a relatively equivalent ad valorem equivalent (AVE) trade cost on trade flows of cattle meat and processed rice in both directions. In the case of cattle meat, this appears to be consistent with the retaliatory nature of NTM instruments employed by US importers on EU bans. In beverages and tobacco and dairy products, however, the AVE of the NTM is higher on EU imports of US goods. In the case of beverages and tobacco, this finding appears to be consistent with the qualitative survey work conducted in ECORYS (2009), whilst the result for US dairy imports from the EU remains at first sight, counterintuitive and deserving of further research.

Keywords: International Relations/Trade; Agricultural and Food Policy (search for similar items in EconPapers)
Pages: 19
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/332375/files/6570.pdf (application/pdf)

Related works:
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:ags:pugtwp:332375

Access Statistics for this paper

More papers in Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().