Non-Tariff Measures: What Do We Know, What Might Be Done?

Carrère, Céline; Mélo, Jaime de

doi:10.11130/jei.2011.26.1.169

Cited by 27 publications

(22 citation statements)

References 13 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Let e ot and e dt , respectively, be the origin and destination countries' exchange rates in LCU per dollar in year t, and P ot and P dt their consumer price indices. 17 Let e odt be the average exchange rate between the origin and destination currencies in year t, and let e U S odt be the average real exchange rate between the destination and the USD in year t. Our bilateral exchange rate variables in logs are defined as follows:…”

Section: Country-level Variablesmentioning

confidence: 99%

Trade Policy and Market Power: Firm-Level Evidence

Asprilla¹,

Berman²,

Cadot³

et al. 2019

View full text Add to dashboard Cite

This paper identifies the effect of trade policy on market power through new data and a new identification strategy. It uses a large data set containing export values and quantities by product and destination for all exporting firms in 12 developing and emerging countries over several years, merged with destination-product-specific information on tariffs and non-tariff barriers. Market power is identified by observing how exporting firms price discriminate across markets in reaction to variations in bilateral exchange rates.Pricing-to-market is prevalent in all regions of the sample, even among small firms, although it is increasing in firm size, in accordance with theory. More importantly, the effect of non-tariff measures is not isomorphic to that of tariffs: the observed pricing-to-market behavior suggests that, although tariffs reduce the market power of foreign firms through classic rent-shifting effects, non-tariff measures alter market structure and reinforce the market power of non-exiting firms, domestic and foreign ones alike.We derive two main testable predictions, respectively related to non-tariff measures and to tariffs. Specifically, we show that NTMs applied in a non-discriminatory fashion -that is, in compliance with the WTO's "national treatment" clause, whereby imported and domestically-produced products must be treated alike -raise market power and PTM for incumbents if they induce the exit of smaller firms, e.g. through higher fixed costs. 4 Import tariffs, on the other hand, decrease the sales of incumbents but also induce the exit of small firms, leading to an ambiguous impact on market power. However, given their discriminatory nature, tariffs are more likely to displace foreign firms in favor of domestic ones, implying that the intensive margin effect dominates and in net tariffs reduce the market shares of exporters and thus their incentive to engage in PTM. 5 We then test these predictions using a large multi-country firm-level data set obtained from customs administrations in twelve developing countries, ranging from low income to middle income. We combine the firm-level data with destination-product specific data on bilateral applied tariffs as well as non-tariff measures. The latter cover a wide range of measures ranging from sanitary and phytosanitary measures to technical barriers to trade. Pooling together firm-level data from several developing countries allows us to provide evidence on the extent of exchange rate pass-through for countries and regions that have received little attention so far. It also allows us to explore more systematically the impact of trade policy on competition and market power using a sample of countries facing different trade policy arrangements, in particular preferential tariffs. Importantly, the high dimensionality of the data enables us to account for unobserved heterogeneity and for a large set of confounding influences at the level of both the firm and the market using a powerful array of fixed effects. The fact that our unit of observation is the ...

show abstract

Section: Country-level Variablesmentioning

confidence: 99%

Trade Policy and Market Power: Firm-Level Evidence

Asprilla¹,

Berman²,

Cadot³

et al. 2019

View full text Add to dashboard Cite

show abstract

“…See, for example, Feenstra (), Leamer (), Anderson and Neary (), Kee et al. (), and Carrere and de Melo ().…”

mentioning

confidence: 99%

Trade Policy and Market Power: Firm‐level Evidence

Asprilla

Berman

Cadot

et al. 2019

Int Economic Review

View full text Add to dashboard Cite

This article identifies the effect of trade policy on market power through new data and a new identification strategy. We identify market power by observing how exporting firms price discriminate across markets following variations in bilateral exchange rates. Pricing‐to‐market is prevalent in all countries in our sample, even among small firms, although it is increasing in firm size. More importantly, we find that the effect of nontariff measures (NTMs) is not isomorphic to that of tariffs. Whereas tariffs reduce the market power of foreign firms through rent‐shifting effects, NTMs reinforce the market power of nonexiting firms, domestic and foreign alike.

show abstract

“…However, it is increasingly recognized that market imperfections such as asymmetric information and production and consumption externalities abound and NTM policy interventions could increase welfare and may be trade-impeding or trade enhancing while increasing welfare (Beghin et al 2012, Carrère andDe Melo, 2011;Disdier et al, 2008;and Disdier and Marette, 2010). NTMs may also be protectionist of course.…”

Section: Introductionmentioning

confidence: 99%

Protectionism indices for non-tariff measures: An application to maximum residue levels

Beghin

2016

World Scientific Studies in International Economics

View full text Add to dashboard Cite

We propose aggregation indices of Non-Tariff Measures (NTMs) to quantify their protectionism relative to international standards. We apply the indices to national Maximum Residue Limit (MRL) regulations affecting agricultural and food trade and using a science-based criteria embodied in Codex Alimentarius international standards. The approach links two streams of the NTM literature, one concerned with the aggregation of various NTMs into operational indices for econometric and modeling purposes, and the other attempting to evaluate the protectionism of NTMs. The data used in the application come from a large international dataset on veterinary and pesticide MRLs and CODEX MRL standards for a large set of countries KeywordsNTMs, non-tariff measures, barriers, protectionism, maximum residue limit, MRL

show abstract

Non-Tariff Measures: What Do We Know, What Might Be Done?

Abstract: With the reduction in tariff barriers, Non-tariff and behind-the-border measures (NTM and BTB) • JEL Classification: F1, F13, O24, O5

Cited by 27 publications

References 13 publications

Trade Policy and Market Power: Firm-Level Evidence

Trade Policy and Market Power: Firm-Level Evidence

Trade Policy and Market Power: Firm‐level Evidence

Protectionism indices for non-tariff measures: An application to maximum residue levels

Contact Info

Product

Resources

About