The Impact of NTMs on Trade: Evidence from Developing Countries

Masoud Ali Khalid and Narmen M. Ghafor
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Masoud Ali Khalid: Department of Economics, University of Sulaimani, Sulaimani
Narmen M. Ghafor: Department of Economics, University of Sulaimani, Sulaimani

International Journal of Finance & Banking Studies, 2019, vol. 8, issue 1, 37-47

Abstract: Non-tariff measures such as food safety and technical standards are used to achieve the non-trade objective of protecting consumers’ health and safety. On the other hand, they can also be deployed as a trade secure tool to drive aprice wedge between foreign and domestic producers. This study investigates the protectionist tools of 34 developing countries food safety standards using a sample of developing countries food imported from developed and other developing countries with a specific focus on vegetables, Trunks, machinery, and tobacco. We employ theoretical framework of gravity equation by applying SGMM estimation. Our results indicate that vegetable and machinery variables are negative and statistically significant. Meaning that both variables have a negative impact on GDP, in other words, both variables are not support GDP and economic growth in the developing countries. Finally, Trunk variable is positive and statistically significant. It shows that, this variable leads to promote economic growth in the developing countries. While Tobacco is positive and statistically insignificant, meaning that this product is not play an important role in the trade sector in our sample countries.

Keywords: Trade Protectionism; Non-tariff measure; Food Safety Standards; Developing countries. And SGMM (search for similar items in EconPapers)
Date: 2019
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