EconPapers    
Economics at your fingertips  
 

Distortion effects of export quota policy: an analysis of the China-Raw Materials dispute

Christophe Charlier () and Sarah Guillou ()

Post-Print from HAL

Abstract: The China-Raw Materials dispute recently arbitrated by the WTO opposed China as defendant to the US, the EU and Mexico as the claimants on the somewhat unusual issue of export restrictions on natural resources. For the claimants, Chinese export restrictions on various raw materials, of which the country is a major producer, create shortages in foreign markets increasing the prices of these goods. China defends export limitations by presenting them as a natural resource conserving policy. This paper offers a theoretical analysis of the dispute with the help of a model of a monopoly extracting a non-renewable resource and selling it on both the domestic and foreign markets. The theoretical results focus on the effects of imposing an export quota on quantities, prices and price distortion. Given the crucial importance of demand elasticities in this theoretical understanding of the conflict, the empirical part of the paper provides estimates of import demand elasticity of the parties for each product concerned in the case. The model and the empirical results challenge the ideas that an export quota always favors conservation of natural resource, that a higher foreign price necessarily follows this policy and that it inherently increases price distortion and therefore discrimination.

Keywords: Article XX of the GATT 1994; Price discrimination; Exhaustible natural resources; WTO; Export restrictions (search for similar items in EconPapers)
Date: 2014
Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-01101567
References: Add references at CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Published in China Economic Review, Elsevier, 2014, 31 (December), pp.320-338. ⟨10.1016/j.chieco.2014.10.004⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: Distortion effects of export quota policy: an analysis of the China-Raw Materials dispute (2014) Downloads
Working Paper: Distortion Effects of Export Quota Policy: an Analysis of the China - Raw Materials Dispute (2014) Downloads
Working Paper: Distortion Effects of Export Quota Policy: an Analysis of the China - Raw Materials Dispute (2014) Downloads
Working Paper: Distortion Effects of Export Quota Policy: An Analysis of the China - Raw Materials Dispute (2014) Downloads
Working Paper: Distortion effects of Export quota policy: an analysis ofThe China - Raw materials dispute (2013) Downloads
Working Paper: Distortion Effects of Export Quota Policy: An Analysis of the China - Raw Materials Dispute (2013) 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:hal:journl:halshs-01101567

DOI: 10.1016/j.chieco.2014.10.004

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().

 
Page updated 2020-06-23
Handle: RePEc:hal:journl:halshs-01101567