The effect of tariffs on Spanish goods exports

Eduardo Gutiérrez Chacón and Cesar Martin Machuca

No 2121, Working Papers from Banco de España

Abstract: This paper investigates the impact of trade protectionism in the form of tariff barriers on Spanish goods exports. The Spanish economy has signicantly increased its degree of openness, which improves potential economic growth, but also implies a higher exposure to the protectionist shift in the international environment observed in the last years. With the purpose of assessing exports sensitivity to tariff increases, we obtain a database combining annual tariffs applied to Spanish products over the years 1995-2019 from WITS and bilateral extra-EU Spanish goods exports from Eurostat, with a product disaggregation level at 6 digits. We estimate the effect of tariffs both on exporting probability (i.e. exports extensive margin) through a linear probability model and exports levels (i.e. exports intensive margin) through a gravity equation. The findings of this paper show that higher tariffs reduce exports levels through extensive an intensive margins. A 1% tariff increase reduces on average the probability of exporting to aspecic market by nearly 0.08 pp. and exported values by around 1%.

Keywords: protectionism; exports; tariffs (search for similar items in EconPapers)
JEL-codes: E43 F41 N10 N30 N40 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2021-05
New Economics Papers: this item is included in nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:bde:wpaper:2121

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