EconPapers    
Economics at your fingertips  
 

Tariff-induced (de)industrialization: An empirical analysis

Marjan Petreski (), Branimir Jovanovic () and Igor Velickovski

MPRA Paper from University Library of Munich, Germany

Abstract: In this paper we investigate if tariffs affect manufacturing value added in 25 countries from Central and Southeast Europe, the Commonwealth of Independent States and Middle East and North Africa over the period1990-2010. We use an instrumental variable approach, with the World Trade Organization bound tariff and the lagged tariff as instruments. Results suggest that, in general, lower tariffs seem to lead to higher value added, through the higher imports of inputs in the production process which were either inexistent or more expensive on the domestic market previously. The effect is not driven by the World Trade Organization membership, but by individual countries’ decision to lower their tariffs. However, there are notable differences in the effects between different groups of countries and industries: tariffs are not found to affect industrialization in Southeast Europe and Middle East and North Africa, which implies that their decision to liberalize trade was likely pre-mature. This is supported by the finding that lower tariffs have positive effects on industry value added only in industries with higher value added (i.e. more mature industries).

Keywords: industrialization; trade liberalization; tariffs (search for similar items in EconPapers)
JEL-codes: F13 F42 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/67701/1/MPRA_paper_67701.pdf original version (application/pdf)

Related works:
Journal Article: Tariff-Induced (De)industrialization: An Empirical Analysis (2017) 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:pra:mprapa:67701

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().

 
Page updated 2019-11-19
Handle: RePEc:pra:mprapa:67701