Rules of Origin as Export Subsidies

Olivier Cadot, Antoni Estevadeordal and Akiko Suwa-Eisenmann

No 331264, Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project

Abstract: The paper estimates the e¤ect of NAFTA’s rules of origin (ROO) on Mexican access to the US market treating explicitly the endogenous determination of ROOs. The first equation determines Mexico’s NAFTA (preferential) exports to the US as a function of tariff preference and Estevadeordal’s qualitative ROO index. The second equation determines ROO strictness on the basis of a Grossman-Helpman model identifying channels through which lobbying by US intermediate-good producers leads to deep preferences and stiff rules of origin in downstream sectors. The estimates suggest that the creation of a captive market for upstream intermediate-good producers is indeed one of their political determinants.

Keywords: International Relations/Trade; International Development (search for similar items in EconPapers)
Pages: 27
Date: 2004
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Related works:
Working Paper: Rules of Origin as Export Subsidies (2005)
Working Paper: Rules of origin as export subsidies (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:pugtwp:331264

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