Non-tariff measures, preferential trade agreements, and prices: new evidence

Olivier Cadot and Julien Gourdon

Review of World Economics (Weltwirtschaftliches Archiv), 2016, vol. 152, issue 2, No 1, 227-249

Abstract: Abstract Combining for the first time a new dataset of non-tariff measures (NTMs) in 65 countries with the CEPII’s unit values database, we estimate average ad-valorem equivalents (AVEs) for sanitary and phytosanitary, technical-barriers-to trade and other measures by section of the Harmonized System of product classification. While most existing AVEs are obtained from indirect quantity-based estimation, ours are obtained from direct price-gap estimation. They lie in a single-digit range, i.e. substantially lower than previous estimates based on older data. Our results may reflect the progressive phasing out of command-and-control instruments such as quantitative restrictions in many countries; they also suggest that sanitary and technical regulations have not substituted for them as trade-restrictive interventions. Most interestingly, we show that deep-integration clauses in regional trade agreements, in particular the mutual recognition of conformity-assessment procedures, substantially reduce the price-raising effect of NTMs, possibly reflecting lower compliance costs.

Keywords: Non-tariff measures; Price gaps; Regional trade agreements; Deep integration; Harmonization; Unit values (search for similar items in EconPapers)
JEL-codes: F13 F15 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (45)

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Related works:
Working Paper: Non-tariff measures, preferential trade agreements, and prices: new evidence (2016)
Working Paper: NTMs, Preferential Trade Agreements, and Prices: New evidence (2015)
Working Paper: NTMs, Preferential Trade Agreements, and Prices: New evidence (2015)
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DOI: 10.1007/s10290-015-0242-9

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