Commitment behaviour in the World Trade Organization's Trade Facilitation Agreement

Abstract

AbstractWe use a new database of commitments made during the process of ratifying the Trade Facilitation Agreement (TFA) to study variation in countries’ commitment behaviour. The TFA is a novel World Trade Organization agreement because it allows developing countries to select commitments from a menu of best practices in trade facilitation, rather than to consent, or not, to a comprehensive package of negotiated commitments. The operation of this á la carte approach to concluding trade agreements is worthy of study in its own right, but the commitment data also offer a high‐level description of progress in an international effort to improve border management procedures around the globe. Our study uses data on TFA commitments to describe progress across subcomponents of the agreement. A regression model shows that the number of Type A trade facilitation commitments that a country made in the TFA ratification process depends on its level of development, population size, ability to control corruption and foreign aid received to support trade facilitation. We use multidimensional scaling techniques to study differences in the content of national commitment bundles. This approach demonstrates that variation in the content of countries’ commitments is closely tied to the number of commitments made.