The trade effects of tariffs and non-tariff changes of preferential trade agreements (original) (raw)
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Preferential trade agreements and the future of Australian trade policy
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1998
Australia is a small open economy contributing less than two per cent to the total world volume. There has been significant structural change in the trade pattern in the last thirty years. The growth of international trade has been at the core of the achievement of industrialisation of less developed economies. Industrial economies have invested directly in those economies with the skill resources and spare capacity. The cost advantages of globalisation may arise from factor availability or in recent times, from incentives offered by accommodating industrial policy. The recognition of the benefits of efficient international trade has been a basis of the GATT and WTO negotiations. The uniform movement towards lower trade distortions in general is observed as the reduction of tariffs. There is general agreement that this process will continue in the long term. This is an example of government policy, arising from an international forum and being implemented in the home market. The key players of the market operate in government, corporate, financial and labour areas. International firms operate along the lines of scaled up domestic firms, as multinational companies. The international legal code has evolved to account for different rules of origin. We may consider these key issues:
Non-Tariff Distortions of Australian Trade
The Economic Journal, 1974
This study is one of a number of studies of non-tariff instruments affecting international trade which were done at roughly the same time in seven countries. These studies are being coordinated by the Trade Policy Research Centre in London. I am grateful to the Australian National University and the Trade Policy Research Centre for allowing me to travel to a conference in London of the persons engaged in these country studies and to benefit from the parallel work which is going on in other countries. This difficult area of trade policy is at last receiving more of the attention it deserves. Hitherto in Australia there have been only passing discussions of a small number of non-tariff instruments in some Tariff Board reports, in the Report of the Vernon Committee and a few other places. This study provides a view of non-tariff instruments in Australia over a short period which has not been available before. The descriptions relate to non-tariff instruments as of mid-1972. I have tried to keep the information up to date until the time I finished the research in August 1972. Keeping up with the changes in non-tariff instruments was itself a major task. There are a few cases in which I have not attempted to keep up to date after completing the original research on these instru ments. The material on quarantine describes the situation as of January 1972 and I have not looked at dumping decisions in 1972. Thus the text should be read as applying to the period before the Labor Party victory in the December 1972 elections. I have put together in the Postscript some of the initial actions and statements of the new government which concern non-tariff interventions in Australia's inter national trade. The study would not have been possible without the considerable and generous assistance given to me by several Departments of the Common wealth Government, especially the Departments of Customs and Excise and Trade and Industry. I am very grateful to the numerous officers v vi Preface of these departments, who tried to guide me through the intricacies of non-tariff practices. I am also very grateful to the Tariff Board and the Bureau of Agricultural Economics for providing me with the data used in Chapter 10 to make estimates of the protection implied by some non-tariff instruments restricting imports. Their help enabled me to put a little flesh on the bare bones of description. Finally I acknowledge the comments of my professional colleagues which led me to polish some of the rough edges. Richard Snape and Sir Leslie Melville read the whole manuscript. Geoff Edwards commented on Chapters 8 and 13, Bob Gregory on Chapter 13, members of the Monash University Seminar on Chapter 12 and members of the University of New England Seminar on Chapter 10.
The Value of Tariff Preferences for the Developing Countries: Australian Experience
Economic Record, 1971
The extent to which the developing countries would benefit from any prospective t a r 3 preferences in the markets of the developed countries is uncertain and several economists have produced estimates purporting to show that the gains would not be substantial [6, PP. 358-9, 381-31, [4], [7] .I These studies are based on various assumptiom concerning the relevant elasticities of demand and sUPP~Y for the exports of the developing countries. In the present paper the fundamental procedure is reversed in that I seek to use data relating to actual imports of products into Australia under the Australian t a r 8 preference scheme for the developing countries, in order to estimate the effects of these preferences. Section I sketches the main features of the scheme and discusses how the real value of the preference margins is affected by other preferential rates. Section I1 presents and discusses the estimates from a trend model of the net increase in the value of imports from the developing countries attributable to the scheme. Limitations of the data and the small number of observations forced me to curtail drastically the scope of the study.2 The model used in Section I1 is very crude. It is a simple trend model that cannot take into account directly the effects of the preferences on the prices (and hence on the quantities) of imports of a particular good from different sources. The only effect of the scheme I estimate from this model is the net change in the f.0.b. value of developing countries' *My colleagues Professor Arndt, Hazel Richter, Paul Luey and Sir Leslie Melville helped this study with their valuable suggestions. Dr W. M. Corden, Oxford University, suggested several points, especially on the value of the Australian scheme as a model for other countries. I wish also to acknowledge my gratitude to Mrs Audrey Cornish and Mrs Beverley Gothe for their assistance and to the Commonwealth Bureau of Census and Statistics and the Departments of Trade and Industry, and Customs and Excise for supplying data. Flgures In square brackets relate to references listed at the end of the article. Originally I had hoped to use an econometric model of Australian trade in the products subject to the preferences. This would have enabled me to estimate simultaneously the effect of these preferences on the quantities and unit f.0.b. values of imports from the developing countries and of trade diverted from third-party countries. This model is derived and discussed in another paper [S]. 1 A 2 THE ECONOMIC RECORD MARCH Numerical code: 1. Value of imports from LDCs at LDC preferential rate. 2. Value of imports from LDCs at rates prater than LDC preferential rate. 3. Value of imports from LDCs at rates I n s than or equal to LDC preferential rate. 4. Value of imports from non-LDCs.
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