THE EFFECT OF TRADE BARRIERS ON SECTORAL TRADE: TARIFFS VERSUS TRADE FACILITATION PROCEDURES
LAURA MÁRQUEZ-RAMOS
Department of Economics and Institute of International Economics, Universitat Jaume I
Campus del Riu Sec, 12071 Castellón (Spain)
INMACULADA MARTÍNEZ-ZARZOSO
Ibero-America Institute for Economic Research, Universität Göttingen
Platz der Goettigen Sieben 3, Goettingen (Germany)
Department of Economics and Institute of International Economics, Universitat Jaume I
Campus del Riu Sec, 12071 Castellón (Spain)
CELESTINO SUÁREZ-BURGUET
Department of Economics and Institute of International Economics, Universitat Jaume I
Campus del Riu Sec, 12071 Castellón (Spain)
Abstract
This paper uses sectoral data on trade barriers and trade flows to assess the effects of trade barriers on international trade. Data on tariffs, cost, number of required documents, time to trade and information technology are used as proxies for trade barriers. With this aim, the role of tariff barriers and trade facilitation measures on trade flows is compared. In order to do so, a gravity model of trade is estimated using bilateral trade data for 13 exporters and 167 importers and sectoral data at 4 digits SITC classification.
Overall, our results show that trade barriers related to the number of days and the number of documents required to trade and technological innovation achievement have a higher impact on trade flows than tariff barriers. This result is also shown not only when the thirteen exporting countries are estimated separately, but also when different sectors are distinguished. According to the obtained results, negotiation efforts in trade policy should be focused on trade facilitation improvements.
Keywords: trade barriers, trade facilitation, sectoral trade.