Border Delays and Trade Liberalization / Edgar Cudmore, John Whalley.

Format:

Book

Author/Creator:

Cudmore, Edgar.

Contributor:

National Bureau of Economic Research.

Whalley, John.

Series:

Working Paper Series (National Bureau of Economic Research) no. w9485.

NBER working paper series no. w9485

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2003.

Summary:

Delays at the border for customs clearance are seemingly a central feature of the trade regime in the CIS states. Here, we argue that with queuing costs being endogenously determined in such circumstances tariff liberalization (even in the small economy case) can be welfare worsening since tariff revenues are replaced by resource using queuing costs. On the other hand, corruption can be welfare improving if queuing costs are replaced by resource transferring bribes. We also show how added distortions between perishable and non-perishable, or between light and heavy goods can also arise. We show these outcomes using a simple general equilibrium model, and explore the numerical implications using Russian data. The orders of magnitude are both significant and opposite in sign to conventional analyses.

Notes:

Print version record

February 2003.