Trade Performance and Regulatory Regimes (original) (raw)

Trade Reforms in a Global Competition Model: The Case of Chile

SSRN Electronic Journal, 2000

We use a global competition model of international trade with heterogeneous firms to evaluate the impact of trade reforms that occurred in Chile at the end of the 70s. We compare the predictions of the calibrated model in terms of productivity, plant turnover, job and trade flows with what occurred in reality using a comprehensive plant-level panel dataset for the manufacturing sector. The model explains several effects of liberalization reforms on industry performance. In contrast to the previous studies we use a general equilibrium approach that allows fully quantifying and identifying the trade liberalization effects on the tradeable and nontradeable sectors. We proceed by performing a counterfactual experiment aimed at exploring the impact of preferential trade agreements negotiated by Chile in recent years with the EU and NAFTA.

Market-Discipline Effects of Trade Liberalization: Micro-Level Evidence from Ecuador, 1997-2003

2008

This paper analyses pro-competitive effects of increased trade openness in the manufacturing industry in Ecuador. The data comes from the survey of manufacturing and mining industries in Ecuador for the years 1997-2003. Estimation procedures on both industry-and establishment-level data try to identify trade policy effect on price-cost margins, using import penetration as the trade variable, and controlling for a number of industry-specific effects that may affect profitability. The results suggest that there has been a market-discipline effect of trade liberalization in Ecuador: there is a reduction in price-cost margins when import penetration increases, especially in manufacturing establishments with larger market shares.

The Distortionary Effects of Tariff Exemptions in Argentina

Social Science Research Network, 1990

Argentina suffers from the indiscriminie use of tariff exemptionsexemptions granted to an industry no matter what its export performance, or exemptions granted only for specific inputs (often capital goods). The Policy. Resarch. and Extenal Affais C-ntplex disuibtus PRE Working Papem to diamte hefindings of work in pn nd to acoage the change of ideas among Bank staff and all otes intetd in develomnemt issue. The= papen cuny the nanes of the authors,reflect only heir views, and should oeused and cited accordingly. The findings, inuepatios, and coclusion ae the authors' own. They shold not be attributed to the World Bank, its Board of Directors. its management. or any of its member coaies.

Economic Performance, Trade Restrictiveness, and Efficiency

Review of Development Economics, 2003

The paper addresses the question of whether trade restrictiveness impacts economic performance, via a trade restrictiveness index that is decomposable into a trade distortion and a domestic distortion component. The paper builds on the Anderson and Neary price index measure of trade distortion, in evaluating trade restrictiveness via a distance function approach. This is accomplished by adding a "dual" version to their trade restrictiveness price index, based on distance functions that scale output quantities. The authors compute the trade restrictiveness quantity index (TRQI) using a parametric frontier approach to model the production side of the economy, and a panel of information on the agricultural sector of a set of European Community countries.The results suggest that the use of TRQI makes a considerable difference to interpretations of the efficiency impact of agricultural trade policies in EC countries, as compared to policy-oriented aggregates or result-oriented measures of trade restrictiveness. . We are grateful to Kevin Fox and an anonymous referee for very helpful suggestions and comments. The usual disclaimer applies.

Trade Policy and Efficiency with Monopolistic Competition

freit.org

A comparative advantages model with monopolistic competition is developed to empirically examine the efficiency of protectionism. Based on Brazil's experience, the foreign economy is specified as a set of (integrated) developed countries, which amplifies the access to fixed (corporate and the plants) costs, and thus untangle variations in economies of scale. The spatial approach to monopolistic competition, having an endogenous markup, is essential for attaining an ample set of cost and pricing variables that ultimately enable us to identify three policy effects: international competition, productive and allocative efficiency, besides a non-cost competition term. Only the period under protection is considered, so that some comparative static analyses about policies draw on a variety of simulations and counterfactuals.

A Case Study on Trade Liberalization: Argentina in the 1990s. Economics Discussion Papers, No 2012-3

Kiel Institute for the World Economy. http://www …, 2012

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Does Tariff Liberalization Promote Trade? Latin American Countries in the Long-Run (1900-2000)

Global Economy Journal, 2008

This paper estimates the effect of trade liberalisation on import performance of selected Latin American countries. The novelty of this study is that it applies a long-term approach covering the whole XX century using times series and panel data analyses. The empirical exercise shows that the relationship between tariffs and import growth in Latin America cannot be taken for granted -as it often happens -and anyway that it is not always quantitatively substantial. In particular, our analysis shows the existence of a long run relationship between tariffs and imports only from the second half of the XX century. It follows that trade liberalisation appears effective in fostering Latin America's trade growth only when integrated within a wider process, implying a multilateral and negotiated approach to trade policy. In this sense, multilateral and regional agreements (e.g. Mercosur) appear to have played a key role not only through tariff reduction but remarkably thanks to the creation of a rule-based system governing global trade relations. This result would confirm the thesis of those who endorse the existence of a formalized trading system to guarantee tariff liberalization and foster trade growth. JEL classification codes: C22, F13, F15, N7

Trade Reform Dynamics and Technical Efficiency: The Peruvian Experience

The World Bank Economic Review, 2000

Markets around the world are becoming more competitive because of changing operating and regulatory environments. One such change-the loosening of trade restrictionsis a macroeconomic policy shift that should have a microeconomic impact on industrial efficiency. Specifically, competitive pressure should discipline or eliminate inefficient producers. This article explores whether or not there is such a dynamic link. It uses a previously unexploited data set to gauge the impact of the 1990 Peruvian reform on plant-level technical efficiency. The results support the argument that the degree of protection and the level of efficiency are inversely related.

The Possibility of Inefficient Liberalization Through Tariffication

Review of International Economics, 1994

A typical step in trade liberalization under the GATT is tariffication-the conversion of quantitative import restrictions to their ad valorem tariff equivalents. This paper shows that, if there is market power in the protected industry, tariffication may cause a global efficiency Iw. In particular, in a small country, if the protected industry is a monopoly that is freely able to export but cannot profitably do so, then tariffication unambiguously imposes global efficiency costs. In a large country, the global efficiency effects are uncertain a priori. In both cases, however, tariffiation unambiguously benefits the monopoly and lowers foreign welfare.