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Firm-level utilization rates of regional trade agreements: importers' perspective

Kazunobu Hayakawa (), Laksanapanyakul Nuttawut and Taiyo Yoshimi ()

No 615, IDE Discussion Papers from Institute of Developing Economies, Japan External Trade Organization(JETRO)

Abstract: While previous theoretical studies have examined exporters' choice of tariff schemes without considering explicit heterogeneity of importers, an empirical analysis on regional trade agreement (RTA) utilization is, in general, possible by employing trade data covering the importers' side. To better link the empirical analysis with a theoretical model, this study develops a model that sheds light on the role of both importers' and exporters' characteristics in RTA utilization. The model enables us to replicate stylized facts concerning importers' RTA utilization. Based on this model, we derive some propositions on the determinants of RTA utilization rates (i.e., share of imports under RTA schemes out of total imports) at an import firm-product level. Finally, we found that these theoretical predictions are supported by highly detailed import data in Thailand from Australia from 2007 to 2009.

Keywords: International trade; International agreements; RTA; Utilization; Thailand (search for similar items in EconPapers)
JEL-codes: F15 F53 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-int and nep-sea
Date: 2016-08-01
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Published in IDE Discussion Paper = IDE Discussion Paper, No. 615. 2016-08-01

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