This paper assesses how cross-country differences in public mandatory food standards affect trade, prices and product quality upgrading in the agri-food sector. We estimate different gravity-type models that exploit the bilateral difference in maximum residue limits over the period 2005 -2014 for 145 products across 59 countries. Our findings show that differences in public regulations are trade-restrictive. However, conditional on trading, they increase product priceseven when we adjust prices for qualitywith null effects on estimated product quality. These effects are pronounced for South-North trade but not exports to the South.

The empirical evidence that institutional differences across countries affect bilateral trade is robust. The crucial question remains how countries can enhance trade amid these differences. In this paper, we measure the degree to which governance and institutions differ between countries as "governance distance". Using a sample of EU/EFTA imports, we examine how adopting private agrifood safety standards modify the effect of governance distance on exports of fruits and vegetables, in particular apples, bananas and grapes within a structural gravity framework. Our results show that while increasing governance distance hinders bilateral trade, the interaction of standards and the governance distance is positively associated with exports, hence partially offsetting the direct trade-inhibiting effects of the latter. GlobalGAP certified countries see the trade-inhibiting effects of governance distance on their exports reduced by about 50%, ceteris paribus.

This article uses a theory‐based translog gravity model to investigate the heterogeneous effects of food standards on aggregate agricultural trade. We revisit the ‘standards‐as‐barriers‐to‐trade’ debate with a distinctive twist. In contrast to existing works, we show that standards reduce trade but even more so for countries that trade smaller volumes. Our identification strategy exploits the within‐country variation in specific trade concerns. We confirm that stricter importer standards are indeed trade‐restrictive. However, the estimated trade cost elasticity varies depending on how intensively two countries trade. Specifically, it decreases in magnitude with an increasing import share of the exporter in the importing country's total imports. The reason is simple but intuitive; bigger trading partners find it more profitable to invest in meeting the costs of importer‐specific standards. This work is novel in showing that the standards–trade debate misses out on an important heterogeneity driven by existing import shares. Liberalising non‐tariff measures will favour smaller trading partners more than well‐established ones.

With increasing global agrifood trade, private food standards and certifications have proliferated. Yet, their trade effects remain ambiguous. We provide further empirical evidence by assessing the effect of GlobalGAP certification on agrifood exports to high-value markets in EU and OECD countries. Empirically, we estimate a structural gravity model-that accounts for zero trade and endogeneity of certification-using a novel dataset of certified producers and land area cultivated to apples, bananas, and grapes from 2010 to 2015. While our results generally confirm the trade-enhancing effect of GlobalGAP certification for both developed and developing countries, we show that the effects vary across products.

This paper assesses how bilateral distance affects within-firm-product variation in free-on-board (FOB) export prices across destinations. I estimate linear models that regress firm-product-destination-time FOB unit values on distance, firm-product-time fixed effects and destination country controls. If distance doubles, the average Swiss agri-food firm increases its FOB export price by 2.3 per cent. However, the positive distance elasticity of export prices reflects product quality differences and/or variable markups. I disentangle both mechanisms and show that, for a given product quality, exporting firms charge higher markups in distant markets. Nevertheless, this form of price discrimination is less pronounced for higher-quality products.