The Empirical Landscape of Trade Policy

Bown, Chad P.; Crowley, Meredith A.

doi:10.1016/bs.hescop.2016.04.015

Cited by 30 publications

(13 citation statements)

References 173 publications

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“… Bown and Crowley () provide several examples of product standards imposed in practice and note that it is typical for foreign suppliers to allege that such standards are either too restrictive or applied in way that discriminates against foreign relative to domestic production, potentially forcing them to undertake additional costly investments to meet compliance requirements. Fontagné et al.…”

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confidence: 99%

Learning, prices and firm dynamics

Bastos

Dias

Timoshenko

2018

Canadian J of Economics

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We document new facts about the evolution of firm performance and prices in international markets and propose a theory of firm dynamics emphasizing the interaction between learning about demand and quality choice to explain the observed patterns. Using data from the Portuguese manufacturing sector, we find that: (1) firms with longer spells of activity in export destinations tend to ship larger quantities at lower prices; (2) older exporters tend to use more expensive inputs; (3) the volatility of output and input prices tends to decline with export experience; and (4) input prices and quantities tend to increase with revenue growth within firms. We develop a model of endogenous input and output quality choices in a learning environment that is able to account for these patterns. Counterfactual simulations reveal that minimum quality standards on traded goods reduce welfare by lowering entry in export markets and reallocating resources from old and large towards young and small firms.

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confidence: 99%

Learning, prices and firm dynamics

Bastos

Dias

Timoshenko

2018

Canadian J of Economics

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“…Anti-dumping measures have also been used to deal with macroeconomic shocks that can potentially jeopardize trade policy cooperation (Crowley, 2010;Crowley, 2013, 2014). To sum up, as also implied by Bown and Crowley (2016), anti-dumping measures are more related to the characteristics of domestic industries using them rather than to unfair pricing by foreign suppliers.…”

Section: Anti-dumping Measuresmentioning

confidence: 95%

‘Where Have all the Distortions Gone?’ Appellate Body Report, Ukraine–Ammonium Nitrate

Herghelegiu

Rubini

2021

World Trade Review

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This article reviews the Appellate Body Report in the Ukraine–Ammonium Nitrate dispute that focused on the impact of Russia's dual pricing in the natural gas market on the ammonium nitrate market. Interpreting the WTO Anti-Dumping Agreement (ADA), the Appellate Body rejected the possibility to reject input costs, which, though distorted, were duly reported in the company's records, and to replace them with a surrogate price which, for the Ukrainian authorities, was the (adjusted) export price of Russian natural gas at the German border. In this article, (a) we fully review the background of the dispute, showing the connections between natural gas and ammonium nitrate prices, and the impact on Russia's price regulation of the domestic market on them; (b) we then review the ADA and concur with the interpretation of the Appellate Body, essentially for systemic reasons; (c) for completeness, we also investigate whether econometrics could accurately determine the natural gas benchmark price in Russia and conclude in the negative; (d) since dual pricing gives an economic benefit to domestic ammonium nitrate producers, we finally test dual pricing under the WTO subsidy rules. The conclusion is that the current disciplines are not likely to apply to dual pricing and lead us to conclude that important distortions are currently left without regulation in the WTO.

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“…It is immediate from the preceding tariff discussion that while no tariff binding scenario stays the same under both FTA and CU formation games, the bound tariff rate ranges shrink under the partial tariff binding scenario and expands under the full tariff binding scenario when the PTA is a CU relative to an FTA since t f < t u . 14 The assumption that the CU maximizes the sum of national utilities is commonly employed in the literature. Issues of the delegation of tariff-setting authority and the choice of weights in the social welfare function are discussed by Gatsios and Karp (1991) and Melatos and Woodland (2007).…”

Section: Different Tariff Binding Scenarios -Customs Unionmentioning

confidence: 99%

Essays on the interaction between multilateral tariff bindings and the formation of preferential trade agreements

Moise¹

2021

Preprint

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This dissertation studies the effect of continual reduction in the tariff bindings and its implications on the static and dynamic formation of preferential trade agreements (PTAs). Underlying trade model is a three country \competing exporters" model. First, utilizing a static game of endogenous trade agreement formation between three countries, we examine the effects of continual reduction in tariff bindings on the role of PTA formation in attaining global free trade. We show that, in the free trade agreement (FTA) formation game, when countries are completely symmetric, free trade always obtains as the coalition-proof Nash equilibrium (CPNE) of the FTA game. Under the customs union (CU) game, CU members exercise an exclusion incentive and free trade fails to be a CPNE. When countries are asymmetric with respect to their comparative advantage, the country with a weaker comparative advantage has an incentive to free ride on trade liberalization of the two others and continual reduction in tariff bindings facilitates FTA formation in attaining global free trade. Next, we employ a three country dynamic model of PTA formation where countries form PTAs over time and investigate the impact of multilateral tariff binding liberalization on the equilibrium extent of FTA and CU formation in isolation. When forming FTAs under relatively high tariff bindings, a myopic free riding incentive of FTA non-members constrains FTA formation. Thus, tariff binding liberalization can facilitate FTA expansion to global free trade. However, when forward looking countries do not value this myopic free riding incentive, tariff binding liberalization can impede FTA expansion to global free trade. In our CU game, CU formation proceeds to global free trade only for relatively high tariff bindings. Finally, we examine the PTA game where countries endogenously choose between CU and FTA formation. Under such a game, we show that the equilibrium emergence of CUs can prevent global free trade that would otherwise occur through FTAs. In contrast, the equilibrium emergence of FTAs can facilitate global free trade that would otherwise not occur through CUs.

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The Empirical Landscape of Trade Policy

Cited by 30 publications

References 173 publications

Learning, prices and firm dynamics

Learning, prices and firm dynamics

‘Where Have all the Distortions Gone?’ Appellate Body Report, Ukraine–Ammonium Nitrate

Essays on the interaction between multilateral tariff bindings and the formation of preferential trade agreements

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