A New Look at the Extensive Trade Margin Effects of Trade Facilitation / World Trade Organization.

Format:

Book

Government document

Author/Creator:

World Trade Organization.

Series:

WTO Working Papers, 25189808 ; no.2014/16.

WTO Working Papers, 25189808 ; no.2014/16

Language:

English

Subjects (All):

Economic research and trade policy analysis.

Trade facilitation and customs valuation.

Local Subjects:

Economic research and trade policy analysis.

Trade facilitation and customs valuation.

Physical Description:

1 online resource (52 pages).

Place of Publication:

Geneva : World Trade Organization, 2014.

System Details:

text file

Summary:

We estimate the effects of trade facilitation on the extensive margins of trade. Using OECD Trade Facilitation Indicators - which closely reflect the Trade Facilitation Agreement negotiated at the Bali WTO Ministerial Conference of December 2013 - we show that trade facilitation in a given exporting country is positively correlated with the number of products exported by destination and with the number of export destinations served by product. To address the issue of causality, we employ an identification strategy whereby only exports of new products, or exports to new destinations, are taken into account when computing the respective margins of trade. Our findings therefore imply a positive causal impact of trade facilitation on the extensive margins of trade. The results are, to a large extent, robust to alternative definitions of extensive margins, to different sets of controls variables and to various estimation methods. Simulating the effect of an increase to the regional or global median values of trade facilitation, we are able to quantify the potential extensive margin gains of trade facilitation reform in different regions.

Access Restriction:

Restricted for use by site license.