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Preference Erosion and Multilateral Trade Liberalization

Joseph Francois, Bernard Hoekman () and Miriam Manchin ()

No 05-073/2, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: Because of concern that OECD tariff reductions will translate intoworsening export performance for the least developed countries, trade preferences haveproven a stumbling block to developing country support for multilateral liberalization.We examine the actual scope for preference erosion, including an econometricassessment of the actual utilization, and also the scope for erosion estimated by modelingfull elimination of OECD tariffs and hence full MFN liberalization-based preferenceerosion. Preferences are underutilized due to administrative burden -estimated to be atleast 4 percent on average- reducing the magnitude of erosion costs significantly. Forthose products where preferences are used (are of value), the primary negative impactfollows from erosion of EU preferences. This suggests the erosion problem is primarilybilateral rather than a WTO-based concern.

Keywords: preference erosion; GSP; WTO; Doha Round; trade and development (search for similar items in EconPapers)
JEL-codes: F13 (search for similar items in EconPapers)
Date: 2005-07-07
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Related works:
Journal Article: Preference Erosion and Multilateral Trade Liberalization (2006)
Working Paper: Preference Erosion and Multilateral Trade Liberalization (2005) Downloads
Working Paper: Preference Erosion and Multilateral Trade Liberalization (2005) Downloads
Working Paper: Preference erosion and multilateral trade liberalization (2005) Downloads
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