Exporting to new destinations and the effects of tariffs: the case of meat commodities

Ghazalian, Pascal L.; Larue, Bruno; Gervais, Jean‐Philippe

doi:10.1111/j.1574-0862.2009.00409.x

Cited by 12 publications

(16 citation statements)

References 36 publications

(49 reference statements)

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“…For most of the factor variables, the impacts are the same for the two periods, the coefficients of the interaction variables being not significant. Overall, our results are in line with those of Ghazalian et al () and Kandilov and Zheng ().…”

Section: Estimation Resultssupporting

confidence: 94%

Analyzing Trade Liberalization Effects in the Egg Sector Using a Dynamic Gravity Model

Tamini

Doyon

Simon

2015

Canadian J Agri Economics

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The objective of the paper is to explore potential changes in trade induced by a liberalization scenario when taking into account persistence in trading partners. Our approach is based on the development of a gravity model that takes into account the dynamics at the extensive margin of trade as well as the persistence effect of the intensity of trade. Our empirical contribution is on the egg sector, where the persistence in trading partners is acute. Our results indicate that the use of static models underestimate imports of table eggs by more than 50% in Canada, when compared with the use of panel dynamic specification. The dynamic specification helps explain why trade liberalizations often increase trade creation between countries that had already been trading partners, while new trading partnerships remain scarce following trade liberalization. Our results also confirm the importance of sunk cost and their negative impact on the probability of export market participation for developing countries. Those results raise questions regarding the benefit of trade liberalization for developing countries, in terms of accessing new market, if they do not benefit from special treatments. L'objectif de cetteétude est d'explorer un scénario de libéralisation du commerce qui prend en considération l'effet de persistance des partenaires commerciaux. Nous développons un modèle de gravité qui prend en considération la dynamique de la marge extensive et la persistance des partenaires commerciaux. Notre contribution empirique est au niveau du secteur des oeufs. Nos résultats indiquent que l'utilisation de modèle statique sous-estime l'impact de scénarios de libéralisation. Ainsi, les importations d'oeufs de table au Canada suivant un tel scénario sont sous-estimées de plus de 50% par rapport au modèle dynamique. La spécification dynamique permetégalement d'expliquer pourquoi la libéralisation du commerce augmente souvent leséchanges entre pays déjà partenaires commerciaux, alors que les gains au chapitre de la marge extensive sont modestes. Les résultats confirmentégalement l'impact négatif des coûts fixes sur la probabilité des pays en développement de participer aux marchés de l'exportation. Ces résultats soulèvent donc des questions quant aux bénéfices de la libéralisation deséchanges pour les pays en développement, en termes d'accès au marché en absence de traitements spécifiques. * Chaire de rechercheéconomique sur l'industrie des oeufs.

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Section: Estimation Resultssupporting

confidence: 94%

Analyzing Trade Liberalization Effects in the Egg Sector Using a Dynamic Gravity Model

Tamini

Doyon

Simon

2015

Canadian J Agri Economics

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“…The impact of the exporter's domestic agricultural production is expected to be positive, while the importer's domestic agricultural production is expected to reduce the probability of nonzero trade ‡ows. Our results con…rm our expectations and are in line of those of Ghazalian, Larue and Gervais (2009) and Kandilov and Zheng (2011). We assess the impact of the history of export market participation proxied by the lagged value of participation.…”

Section: Dynamic Probit Estimatessupporting

confidence: 84%

Analyzing Trade Liberalization Effect in the Egg Sector Using a Dynamic Gravity Model

2012

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Abstract:This study analyzes the effects of different liberalization scenarios in the international trade of eggs and egg products. We use a dynamic gravity model that takes into account the observed persistence of trading partners. The estimated parameters of the gravity model serve to quantify the impact of various liberalization scenarios on the probability of importing (extensive margin) and on trade volumes (intensive margin). The results indicate that even in the context of aggressive trade liberalization, trade gains at the extensive margin will be modest. Gains at the intensive margin of trade are present even in the context of partial liberalization -Doha type -of trade.Keywords: Eggs and eggs products, Persistence in trade, Trade liberalization, Gravity model, Random-effects dynamic Probit, Autoregressive panel Résumé:Cette étude analyse les impacts de différents scénarios de libéralisation du commerce international des oeufs, des ovoproduits et des produits à base d'oeufs. Nous utilisons un modèle de gravité dynamique prenant en compte l'effet de persistance des partenaires commerciaux. Les paramètres estimés du modèle de gravité sont utilisés afin de quantifier l'impact des scénarios de libéralisation sur la probabilité d'exporter (marge extensive) et sur l'intensité des volumes commerciaux (marge intensive). Les résultats montrent que les gains sur la probabilité d'exporter sont modestes et cela quel que soit l'ampleur de la libéralisation des échanges. Par contre la libéralisation des échanges se traduit par une augmentation des volumes exportés aussi bien dans le cas du scénario de libéralisation partielle -type Doha -que dans celui d'une libéralisation agressive des échanges.

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“…In attempting to quantify policy‐induced trade gains, it is acknowledged (Vollrath et al, 2009) that gravity studies need to accommodate measures of trade protection on a commodity by commodity basis. Although there exist a number of recent gravity studies which explore this issue (e.g., de Frahan and Vancauteren, 2006; Ghazalian et al, 2009; Raimondi and Olper, 2011; Tamini et al, 2010; Vollrath et al, 2009), in all cases (except the latter) the commodity coverage is limited to two or three sectors, whereas none of the above extends the definition of protectionism to explicitly account for export refunds.…”

Section: The Gravity Specification: Relevant Developments and Issuesmentioning

confidence: 99%

Capturing zero‐trade values in gravity equations of trade: an analysis of protectionism in agro‐food sectors

Philippidis

Ezcaray

Sanjuán-López

2013

Agricultural Economics

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With significant improvements in its theoretical underpinnings, the gravity model has gained renewed interest in the agro-food trade literature. Notwithstanding, there is a dearth of literature examining the relative trade restrictiveness of tariff barriers across a broad range of agro-food sectors. This represents an important research gap, which this study sets out to fill. Furthermore, this research reconciles the application of zeroinflated models with a sectorally disaggregated analysis. More specifically, employing a fully specified gravity equation, a Poisson estimator and variants of the Poisson model (Negative Binomial, Zero-Inflated Poisson, and Zero-Inflated Negative Binomial) provide statistically significant and theoretically consistent estimates, while allowing for the inclusion of zero-trade values. A panel data model with fixed effects is also employed to improve the estimation of the parameters of interest. Estimation results reveal that in the vast majority of sectors examined, import tariffs are found to be statistically significant, whereas export refunds exhibit a statistically smaller role due to the nonsystematic nature of their application in world food markets. Model simulations of tariff barrier eliminations reveal limited trade gains, although there is encouraging evidence of "low" and "lower middle" per capita income country trade gains in wheat, red meat, dairy, sugar, and (particularly) rice markets.JEL classifications: C13, F13, F14, F17, Q17, Q18

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Exporting to new destinations and the effects of tariffs: the case of meat commodities

Cited by 12 publications

References 36 publications

Analyzing Trade Liberalization Effects in the Egg Sector Using a Dynamic Gravity Model

Analyzing Trade Liberalization Effects in the Egg Sector Using a Dynamic Gravity Model

Analyzing Trade Liberalization Effect in the Egg Sector Using a Dynamic Gravity Model

Capturing zero‐trade values in gravity equations of trade: an analysis of protectionism in agro‐food sectors

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