scholarly journals Labor clauses in trade agreements: Hidden protectionism?

2021 ◽  
Author(s):  
Céline Carrère ◽  
Marcelo Olarreaga ◽  
Damian Raess
Keyword(s):  
Developing Countries ◽  
Bilateral Trade ◽  
Positive Impact ◽  
A Priori ◽  
Trade Agreements ◽  
Trade Flows ◽  
Middle Income ◽  
Positive Effects ◽  
Bilateral Trade Flows ◽  
The Impact

AbstractWe explore the impact of the introduction and design of labor clauses (LCs) in preferential trade agreements (PTAs) on bilateral trade flows over the period 1990–2014. While it is not a priori clear if the inclusion of LCs in PTAs will decrease or increase bilateral trade, we expect the direction of trade to matter, that is, we expect to observe the (negative or positive) impact of LCs in the South-North trade configuration. We also expect, in that configuration, stronger LCs to yield stronger (negative or positive) effects on bilateral trade flows. Using a novel dataset on the content of labor provisions in PTAs, we find in line with our first expectation that while the introduction of LCs has on average no impact on bilateral trade flows, it increases exports of low and middle-income countries with weaker labor standards in North–South trade agreements. Consistent with our second expectation, this positive impact is mostly driven by LCs with institutionalized cooperation provisions. In contrast, LCs with strong enforcement mechanisms do not have a statistically significant impact on exports of developing countries in North–South PTAs. The results are inconsistent with the ideas that LCs are set for protectionist reasons or have protectionist effects, casting doubt on the logic for the reluctance of many developing countries to include LCs in their trade agreements.

scholarly journals The Trade Effect of the EU’s Preference Margins and Non-Tariff Barriers

2020 ◽  
Vol 13 (9) ◽  
pp. 203
Author(s):  
Maria Cipollina ◽  
Federica Demaria
Keyword(s):  
Developing Countries ◽  
Bilateral Trade ◽  
Developed Countries ◽  
International Markets ◽  
Trade Flows ◽  
Preferential Trade ◽  
Trade Effect ◽  
Bilateral Trade Flows ◽  
The Developed Countries ◽  
The Impact

Nowadays, trade negotiations afford both liberalism- and protectionism-oriented policies. Indeed, in recent decades, the developed countries have been actively engaged in negotiating many preferential agreements to integrate developing countries (DCs) into world trade and encourage their economic growth, but many of these schemes contrast with the complex rules, often imposed on international markets, that still are an obstacle for exporters. Their presence and related costs reduce the importance of preferential trade agreements (PTAs) in increasing trade flows. This article attempts to assess the impact of preferential trade policies on trade flows controlling for different non-tariff barriers (NTBs), using a structural gravity model. The analysis uses disaggregated data, registered in the year 2017, on EU imports (defined at level HS-6 digit) from a large number of exporters (187 developed and developing countries) and also includes the intra-EU trade. Our results show robust and positive estimates for the impact of preferences on bilateral trade flows, however, higher non-tariff barriers are likely to play a role in reducing both the extensive margins of trade, and so tariff preferences alone are not sufficient to access international markets. The impact of NTBs on the intensive margin of trade is ambiguous; some measures may act as catalysts and therefore increase trade, and others may act as an additional cost of trade and thus hinder trade.

scholarly journals Effects of COVID-19 on trade flows: Measuring their impact through government policy responses

PLoS ONE ◽  
2021 ◽  
Vol 16 (10) ◽  
pp. e0258356
Author(s):  
Javier Barbero ◽  
Juan José de Lucio ◽  
Ernesto Rodríguez-Crespo
Keyword(s):  
Bilateral Trade ◽  
State Of The Art ◽  
Negative Impact ◽  
Trade Agreements ◽  
Trade Flows ◽  
Policy Responses ◽  
Negative Effect ◽  
Bilateral Trade Flows ◽  
Gravity Model Of Trade ◽  
The Impact

This paper examines the impact of COVID-19 on bilateral trade flows using a state-of-the-art gravity model of trade. Using the monthly trade data of 68 countries exporting across 222 destinations between January 2019 and October 2020, our results are threefold. First, we find a greater negative impact of COVID-19 on bilateral trade for those countries that were members of regional trade agreements before the pandemic. Second, we find that the impact of COVID-19 is negative and significant when we consider indicators related to governmental actions. Finally, this negative effect is more intense when exporter and importer country share identical income levels. In the latter case, the highest negative impact is found for exports between high-income countries.

scholarly journals INSTITUTIONS AND INTRA-REGIONAL TRADE IN CEFTA 2006: A GRAVITY APPROACH

2019 ◽  
Vol 1 (17) ◽  
pp. 11
Author(s):  
Łukasz Klimczak ◽  
Jelena Trivić
Keyword(s):  
Free Trade ◽  
Bilateral Trade ◽  
Free Trade Agreements ◽  
Trade Agreements ◽  
Trade Flows ◽  
Positive Sign ◽  
Regional Trade ◽  
Bilateral Trade Flows ◽  
The Impact

The purpose of this paper is to identify factors that had an influence on bilateral trade flows among the CEFTA countries with special emphasize: 1) on the role of CEFTA agreement and its preceding network of bilateral free trade agreements, and 2) on the role of institutions in facilitating intra-regional trade. In order to assess the impact of these variables on trade, we employed an augmented gravity model based on panel data of the CEFTA countries in fifteen years period (2000-2014). The results of the research suggest that there was a positive and statistically significant role of the CEFTA agreement on trade between its parties but the influence of the preceding bilateral free trade agreements was even higher. Results also showed that institutions can play an important role as trade facilitators, but mainly in the importing country while in the exporting country only three of six variables showed to have a positive sign.

scholarly journals ANALYSIS OF GEOGRAPHIC DISTANCE EFFECTS ON INTERNATIONAL TRADE FLOWS AS A PUBLIC POLICY: EVIDENCE FROM EAC AND NAFTA COUNTRIES.

2015 ◽  
Vol 10 (10) ◽  
pp. 2540-2549
Author(s):  
Laetitia Byukusenge ◽  
Song Wei ◽  
Delphine Tuyishime
Keyword(s):  
Developing Countries ◽  
International Trade ◽  
Bilateral Trade ◽  
Geographic Distance ◽  
Developed Countries ◽  
Trade Flows ◽  
Trade Barriers ◽  
Middle Income ◽  
Distance Effects ◽  
Bilateral Trade Flows

Previous studies have shown that the geographic distance is among the factors that can typically results in diminished trade flows between two or more countries. As the international trade is one among the public policies, the governments of countries have to take control policies about their imports and exports after signing some trade contracts or agreements of eliminating trade barriers between trade countries. This paper analyzes and compares how the geographic distance affects the international trade flows of developed and developing countries‟ economies and becomes the obstacle to the developing countries to achieve their objectives and goals in eliminating trade barriers between their trading partners. The gravity model with panel data sets for period of 2008 to 2011 are used to determine the geographic distance effects in those countries. The sample size is bilateral trade flows of eight developing countries with lower income of EAC and two developed countries and one developing country with middle income of NAFTA. The study discovers that the various factors influence the geographic distance effects on international trade flows of developed and developing countries in different ways. This paper recommends that the signed policies between countries should be observed, maintained and followed in order to achieve expected objectives.

scholarly journals The Value-Added Effects of Exchange Rates on Global Trade

2021 ◽  
Vol 10 (1) ◽  
pp. 184
Author(s):  
Myoung Shik Choi ◽  
Hun Dae Lee
Keyword(s):  
Exchange Rate ◽  
Bilateral Trade ◽  
Value Added ◽  
Trade Flows ◽  
Intermediate Goods ◽  
Negative Effects ◽  
Policy Objective ◽  
Positive Effects ◽  
The Us ◽  
Bilateral Trade Flows

This study is an investigation of view about the gross, bilateral, and value-added trades adjusting to exchange rate and income within global value chains. Various difference between aggregate and value-added trade flows is introduced. We adopt the traditional trade models and test them using time-series analysis on value-added exports and imports. We find that currency depreciation has negative effects on gross exports in the US and Korea due to intermediate goods imports, but positive effects on value-added exports in Japan and Korea. On the other hand, currency appreciation has negative effects on gross imports in the US, China, Japan and Korea due to intermediate goods exports, but positive effects on value-added imports in Japan. All income effects are positive as we expect. Also, we find the similar effects of exchange rate on bilateral trade flows. On the whole, depreciation has negative effects on gross exports but positive effects on value-added exports while appreciation has negative effects on gross imports but positive effects on value-added imports. With this study, the main contribution is further evidence on the value-added trade analysis. Practical implications reducing uncertainty could be an important policy objective to achieve higher growth.   Received: 23 October 2020 / Accepted: 16 December 2020 / Published: 17 January 2021

Exploiting the Trade Potential from Integration: Analysing the Impact of Free Trade Agreements between ASEAN and India and China

China Report ◽  
2018 ◽  
Vol 54 (4) ◽  
pp. 442-466 ◽  
Author(s):  
Nguyen Xuan Trung ◽  
Nguyen Duc Hung ◽  
Nguyen Thi Hien
Keyword(s):  
Free Trade ◽  
Free Trade Agreement ◽  
Bilateral Trade ◽  
Positive Impact ◽  
Stochastic Frontier ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Trade Agreements ◽  
The Impact ◽  
Stochastic Frontier Estimation

In this article, we use the technique of stochastic frontier estimation for the structural gravity model to analyse Vietnam’s bilateral trade and evaluate its exploitation of trade efficiency before and after its free trade agreements (FTAs) with China and India entered into force. The results from Vietnam’s bilateral trade data between 2000 and 2015 show that the ASEAN–India Free Trade Agreement (AIFTA) has had a positive impact on Vietnam’s bilateral trade flows while we found a remarkably negative effect on Vietnam’s exports but not imports after the entry into force of the ASEAN-China Free Trade Agreement (ACFTA). In addition, Vietnam’s participation in the regional trade agreements (RTAs) and FTAs has significantly reduced the costs of trade over time, and these impacts on Vietnam’s imports are much higher than those on Vietnam's exports.

EUROPEAN ACCESSION AND THE TRADE FACILITATION AGENDA

2010 ◽  
Vol 01 (02) ◽  
pp. 227-249 ◽  
Author(s):  
JOHN S. WILSON ◽  
XUBEI LUO ◽  
HARRY G. BROADMAN
Keyword(s):  
Bilateral Trade ◽  
Trade Flows ◽  
Institutional Capacity ◽  
Trade Facilitation ◽  
Economies In Transition ◽  
Port Efficiency ◽  
Bilateral Trade Flows ◽  
Development Levels ◽  
The Impact ◽  
The Eu

This paper examines the impact of improved trade facilitation measures and institutional capacity in a set of economies in transition Europe. Our results suggest that behind-the-border barriers play an important role in determining bilateral trade flows (controlling for the effects of tariffs, development levels, distance, and regional characteristics of exporters and importers, among other factors). For European Union (EU) members that joined the Union in 2004 and less developed and candidate members raising capacity in port efficiency and information technology infrastructures halfway to the EU-15 average, trade could expand by US$49 billion and US$62 billion respectively. In the context of the economic crisis and fragile recovery, as well as efforts to strengthen Europe integration, efforts to facilitate trade with investments to raise capacity in trade facilitation should be considered as part of policy steps going forward.

scholarly journals The Impact of Trade Facilitation on Vietnam’s Trade Flows

2021 ◽  
Author(s):  
AISDL
Keyword(s):  
Bilateral Trade ◽  
Trade Flow ◽  
Economic Benefits ◽  
Global Market ◽  
Trade Flows ◽  
Border Crossing ◽  
Trade Facilitation ◽  
Cross Border ◽  
Bilateral Trade Flows ◽  
The Impact

In a globalized economy, countries actively participate in Free Trade Agreements (FTAs) to bring their advantageous products to the global market through cross-border transport to satisfy customers. Trade Facilitation (TF) has become key to address the difficulties faced by traders in cross-border transport. In the trend of global TF, Vietnam has always been committed to implement TF measures by simplify customs procedures and improving customs clearance efficiency at the border crossing in order to help traders reduce their trading costs. This paper mainly considers the impact of TF measures on Vietnam‘s trade flow under the effect of FTAs. Using the gravity model extended with quantitative measures of customs environment, regulatory environment, and service infrastructure, this paper estimates the impact of TF on bilateral trade flows with Vietnam. The results show that port and customs effects have positive impacts on Vietnam's trade flows. The results also show that these impacts are consistent despite the existence of FTAs. The implementation of TF measures always requires coordination of countries to produce the best results. Indeed, the increase in trade flows between countries will bring economic benefits. And when the reforms of TF are strictly implemented, reducing trade costs will increase trade volume. In a nutshell, TF has gradually become one of the important factors of economic growth.

scholarly journals The impact of preferential trade agreements on bilateral trade: A structural gravity model analysis

PLoS ONE ◽  
2021 ◽  
Vol 16 (3) ◽  
pp. e0249118
Author(s):  
Xing Yao ◽  
Yongzhong Zhang ◽  
Rizwana Yasmeen ◽  
Zhen Cai
Keyword(s):  
Gravity Model ◽  
Bilateral Trade ◽  
Market Access ◽  
Trade Agreements ◽  
Preferential Trade Agreements ◽  
Trade Integration ◽  
Preferential Trade ◽  
Middle Income ◽  
Wide Range ◽  
The Impact

Trade agreements are thought to raise trade integration, but existing preferential trade agreements (PTAs) are insufficient in measuring market access of products. This study develops a product-based coverage index of PTAs using the World Trade Organization (WTO) preferential trade agreements and calculates bilateral trade measures using the EORA multi-regional input-output (MRIO) tables covering 189 countries worldwide over the period 1990–2015; the structural gravity model is employed to test how PTAs affect bilateral trade. Our findings show that countries sharing a common PTA could boost the trade volume compared to those without PTAs, supporting the trade creation effect. However, the trade promotion effect of the product-based coverage index of PTAs is significant only if the member countries are low-and middle-income countries. Further, the wide range of product liberalization brought by PTAs can promote global production networks by stimulating the trade of intermediate goods. Our results are important for understanding the market access effect of PTAs with the increasing development of trade integration and global value chains (GVCs).

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