EconPapers    
Economics at your fingertips  
 

Empirical analysis of the national treatment obligation under the WTO: The case of Japanese shochu

Naoshi Doi and Hiroshi Ohashi ()

Journal of the Japanese and International Economies, 2017, vol. 46, issue C, 43-52

Abstract: The national treatment obligation, along with the most favored nation obligation, is an important principle of non-discrimination adopted by the World Trade Organization. It requires that foreign products be treated no less favorably than national products. This paper empirically examines the 1996 WTO recommendation that a Japanese distilled alcoholic beverage, shochu, be classed as a “directly competitive or substitutable product” with regard to other distilled drinks, and thus that not taxing similarly be in violation of its national treatment obligation. Demand estimates obtained from a random-coefficient discrete-choice model reveal that a substitution pattern of shochu is far more complicated than that presumed by the WTO. Upon the WTO recommendation, Japan made all distilled alcoholic beverages be taxable at the same level. Our simulation analysis indicates that the tax revision, while it reduced the tax revenue, improved Japanese national welfare.

Keywords: National treatment obligation; WTO; Random-coefficient discrete-choice model; SSNIP test (search for similar items in EconPapers)
JEL-codes: F13 L66 H21 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0889158317300357
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Empirical Analysis of the National Treatment Obligation Under the WTO: The Case of Japanese Shochu (2012) Downloads
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:eee:jjieco:v:46:y:2017:i:c:p:43-52

DOI: 10.1016/j.jjie.2017.08.001

Access Statistics for this article

Journal of the Japanese and International Economies is currently edited by Takeo Hoshi

More articles in Journal of the Japanese and International Economies from Elsevier
Bibliographic data for series maintained by Haili He ().

 
Page updated 2020-12-19
Handle: RePEc:eee:jjieco:v:46:y:2017:i:c:p:43-52