Trade protection and the role of non-tariff barriers

Kinzius, Luisa; Sandkamp, Alexander-Nikolai; Yalçin, Erdal

doi:10.1007/s10290-019-00341-6

Cited by 51 publications

(31 citation statements)

References 35 publications

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“…Overall, the results are in line with our expectations. Consistent with much of the existing literature, we confirm that stricter importing country standards are indeed trade-restrictive (Fiankor et al, forthcoming;Disdier et al, 2008b;Curzi et al, 2018;Kinzius et al, 2019;Fernandes et al, 2019) at least when they raise objections as an STC. In line with Melitz (2003) and Helpman et al (2008) type models, a stringent importing country standard induces a selection effect by raising fixed and variable trade costs that discriminate against non-compliant producers.…”

Section: Resultssupporting

confidence: 89%

“…As our opening quote suggests, this knowledge is as old as the first meeting of the Joint FAO/WHO Expert Committee on Nutrition in 1950. Yet, recent empirical findings – for example, public standards decrease the probability of trade (Ferro et al ., 2015; Crivelli and Gröschl, 2016), and reduce both the value of trade conditional on exports (Disdier et al ., 2008b; Curzi et al ., 2018; Kinzius et al ., 2019; Fernandes et al ., 2019) and the number of varieties traded (Fiankor et al ., forthcoming) – show that we have made little, if any progress, in addressing the negative effects of this regulatory heterogeneity across countries.…”

Section: Introductionmentioning

confidence: 99%

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The Heterogeneous Effects of Standards on Agricultural Trade Flows

Fiankor¹,

Haase²,

Brümmer³

2020

J Agricultural Economics

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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.

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Section: Resultssupporting

confidence: 89%

Section: Introductionmentioning

confidence: 99%

The Heterogeneous Effects of Standards on Agricultural Trade Flows

Fiankor¹,

Haase²,

Brümmer³

2020

J Agricultural Economics

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“…This conclusion is in line with the observation that while protectionism (achieved, for example, by increasing non‐tariff barriers, as documented by Kinzius, Sandkamp, & Yalcin, 2019), is a direct way to protect losers, the presence of a redistributive welfare state provides an indirect way to protect them by keeping the borders open (what is usually referred to as ‘embedded liberalism’). The problem, however, is that redistribution can only be funded by raising current or future taxes, which may be politically difficult to implement and which explains why in some cases the choice of protectionism may be the easiest way out for a government (Milner, 2018).…”

Section: Discussionsupporting

confidence: 81%

An analysis of the current backlash of economic globalization in a model with heterogeneous agents

Posta

2020

Metroeconomica

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This paper analyzes the current phase of backlash of economic globalization using a target zone approach in an environment populated by heterogeneous agents. The target zone analysis suggests that there may be a positive expectation effect (a ‘honeymoon’) when the social costs are credibly expected to remain below the benefits arising from globalization. In such a situation, the latter proceeds even beyond the level that society would be willing to accept in the absence of a such a target. When the costs are expected to exceed the benefits, instead, the opposite phenomenon (a ‘divorce’) arises. While in the case of exchange rates or interest rates, the passage from ‘honeymoon’ to ‘divorce’ might well occur with a discrete jump of the respective variable, rather than gradually, this is not the case when considering economic and social costs. Graduality is obtained thanks to the introduction of the hypothesis of heterogeneous agents. The proportion of those who think that the costs of globalization exceed the benefits increases with globalization and the ‘honeymoon’’, then, gradually turns into a ‘divorce’. Government's redistributive intervention to compensate the losers, however, could reduce the costs of globalization, thereby delaying or even preventing its crisis.

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“…Another interesting finding of this study is that as trade increases, a country's propensity to protect itself increases. Kinzius et al (2019) argue that the number of non-tariff trade barriers is growing in the modern world, and these restrictions lead to a 12% reduction in imports.…”

Section: Literature Reviewmentioning

confidence: 99%

Protectionism and non-resource economic growth: Evidence from Azerbaijan

Seyfullayev

2020

Problems and Perspectives in Management

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In the modern world, many developing countries take protective measures to develop domestic industries and diversify their economies to ensure economic sustainability. This issue is a priority, especially in those countries where economic development is provided mainly through the export of natural resources. This article aims to assess the impact of protectionist measures on the development of non-resource sectors of the economy. The object of the study is the non-oil sector of the Azerbaijani economy, where oil revenues account for over 80% of the country’s total exports. The study covers the 2005–2019 years. Granger Causality test in the VAR environment was used to identify and assess the causal relationship between protectionist measures and the non-oil sector development. It was revealed that such indicators as “customs revenues” and “exchange rate” do not increase non-oil GDP. The study results suggest that increasing the effectiveness of protectionism (in terms of economic growth) requires more reasonable and consistent regulatory measures. Targeting priority sectors and establishing monitoring mechanisms on the results of protectionist measures is also a priority for assessing their feasibility.

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Trade protection and the role of non-tariff barriers

Cited by 51 publications

References 35 publications

The Heterogeneous Effects of Standards on Agricultural Trade Flows

The Heterogeneous Effects of Standards on Agricultural Trade Flows

An analysis of the current backlash of economic globalization in a model with heterogeneous agents

Protectionism and non-resource economic growth: Evidence from Azerbaijan

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