Reduction Of Trade Barriers Research Articles

Old Wine in a New Bottle? Green Industrial Policy and the Use of Safeguards in the Solar Sector

Enhancing manufacturing competitiveness in the solar photovoltaics (PV) sector has been a political priority for numerous countries, with green industrial policies often used to effectuate such priorities. In 2018, safeguards were utilized by the United States as a new form of green industrial policies in the solar PV sector, which was quickly followed by India. Safeguards are distinctly different from other widely employed green industrial policies, and their use threatens the multilateral trading system and impedes much-needed efforts to mitigate climate change. This article seeks to advance the literature on the interaction between green industrial policies and the World Trade Organization (WTO) by exploring the legal considerations and policy implications of employing safeguards in the PV Sector. This article discusses why the WTO would likely find that both the US and Indian measures violate the General Agreement on Tariffs and Trade and the Agreement on Safeguards (AS), but perhaps more importantly reveals several deficiencies associated with the WTO rules and institutional difficulties which may curtail the reduction of trade barriers. This article suggests the negotiation of a plurilateral agreement to eliminate the use of safeguards in the solar PV sector and foster a positive synergy between the trade and climate regimes. WTO, Safeguards, Green Industrial Policy, Solar PV, Trade Protectionism, Climate Change

Semi-inclusive regional economic agreements in the pacific: a perspective from global value chains

ABSTRACT A flurry of recent regional economic agreements in the Pacific are best characterized as ‘semi-inclusive,’ as each tends to include some large economies in the region but omit some others. With a perspective from global value chains (GVCs), we assess two particular dimensions of these agreements: (a) reduction in trade barriers, and (b) promotion of cross-border direct investment. We argue that China can be expected to gain from both the RCEP and China-EU Comprehensive Agreement on Investment (CAI), and it will likely gain even further from undertaking the necessary reforms to become a member of the CPTPP.

PENGARUH PENURUNAN TARIF IMPOR TERHADAP PERMINTAAN TENAGA KERJA MANUFAKTUR DI INDONESIA

Abstract In the last two decades the trading system in developing countries has become more open with reduced trade barriers through decreasing import tariffs. Based on previous research, there is a theoretical and empirical relationship between the reduction in import tariffs and the demand for labor. This study examines the relationship between the reduction in import tariffs and the demand for formal labor at the district / city level in the medium term. Meanwhile, workers need time to move between sectors and between regions to be absorbed in sectors that are experiencing an increase in exports. Therefore, in analyzing the demand for manufacturing labor due to a reduction in import tariffs, this research is conducted in the medium term, namely in a five-year period. By using data on labor in the manufacturing sector at the district / city level in Indonesia from 2000 to 2015, this study estimates the effect of reducing import tariffs on the demand for formal manufacturing labor with weighted regression. In contrast to previous studies, this study uses the measurement of exposure to the reduction in import tariffs by Dix-Carneiro Kovak (2017) for the manufacturing sector at the district / city level and covers 22 manufacturing subsectors. The estimation results show that the reduction in import tariffs in the manufacturing sector in the medium term increases the demand for formal manufacturing labor. This needs to be supported by the formation of industrial areas with diverse manufacturing sectors. However, this empirical evidence contradicts the policy of forming industrial estates that are specialized with regional superior potential in accordance with Presidential Regulation Number 28 of 2008.

A passage to India: Quantifying internal and external barriers to trade

This paper quantifies the size of internal versus external trade barriers and assesses the trade and welfare impact. I develop a quantitative two-sector international trade model featuring nonhomothetic preferences in which Indian states trade both domestically and internationally. I discipline the model using rich data on price dispersion together with state-based foreign and domestic trade flows. I find that (1) internal trade barriers make up 40% of total trade barriers on average, but vary substantially by state depending on the distance to the closest port; and (2) reducing trade barriers across Indian states to the United States level increases welfare more (13%) than removing international import barriers (7%).

Impact of regulatory trade barriers and controls of the movement of capital and people on international trade of selected Central, Eastern and Southeastern European economies

Free movement of people, goods, services and capital is one of the cornerstones of the European Union (EU). Although various obstacles to free movement still exist, all EU members are dedicated to reducing barriers. While the role of tariffs is gradually declining, other barriers to free movement are becoming increasingly important in recent years. Therefore, this paper focuses on the impact of regulatory trade barriers and controls of the movement of capital and people on international trade of selected Central, Eastern and Southeastern European economies (CESEE), i.e. post-communist economies that eventually became EU members. CESEE economies stem from a centrally-planned economy environment which is why it is particularly interesting to analyse how these countries managed to establish free movement and reduce trade barriers. Employing panel data methodology, the findings of the paper suggest that reducing regulatory trade barriers and controls of the movement of capital and people leads to an increase in international trade. Moreover, accompanying the results of the empirical analysis with the indicators of corruption and ease of doing business highlights the necessity of implementing various structural policies and tackling corruption as a prerequisite of fostering the free movement of people, goods, services and capital.

Trade Restriction and Economic Growth: A Study of Developed and Developing Countries

According to the World Bank, most research suggests that unilateral reduction in trade barriers can result in the greatest and the quickest gains in welfare. However, recently United States imposed tariffs on good imported from China and Chinese government retaliated by introducing trade barriers on imports from the United States. Generally, developed counties attempt to improve their trade deficits by allowing the exchange rate to depreciate, whereas developing countries rely more on trade restrictions.
 In this paper, five developed countries and five developing countries that experienced persistent trade deficits were selected. A VAR statistical technique was used to examine the effects of exchange rate changes of the net trade of two selected groups of countries. It is shown that in case of developed counties, the exchange rate and net trade moved in the same direction. However, the same results were not confirmed for the developing countries.

Comparative advantage of groundnut export from India with other selected countries

The paper analyses the comparative advantage in the export of groundnut between some selected countries. Current global integration and changing export pattern has resulted in the reduction of trade barriers. Such increment in the international trade led the countries to get productive gains and enjoy the comparative advantage over other countries for which a measure of revealed comparative advantage (RCA Balassa index) is used. Groundnut exports share in India's total exports have shown a decreasing trend over the years and it was only 0.141 per cent in 2018. Although the Indian groundnut has wide scope for exports in the international market yet the groundnut farmers are suffering from many backlogs which hinder the actual growth of groundnut exports. Groundnut farmers of India have confronted with various challenges to survive in the international market. India has an increasing growth in terms of comparative advantage in groundnut export. It has maintained stability over the years which indicates that India's groundnut export has significant potential for growth. Country has the highest comparative advantage 13.69 in the exports of groundnut in comparison with other selected countries as it holds the potential of being the world's leading groundnut producer with the ongoing research to develop technologies for rainfed groundnut farming.

Research on Import and Export Trade Based on China's FDI to Central Asian Countries

Based on China’s FDI and import and export trade data with Central Asian countries from 2011 to 2019, this article studies whether and how China’s investment in Central Asian countries affects import and export trade. The analysis methods of this article include descriptive statistics and empirical analysis, which are used to describe the relationship and trend of China’s FDI to Central Asian countries and import and export trade. In the empirical analysis, this paper chooses the panel data linear regression model. Through regression analysis of FDI-import and FDI-export, we test the impact of China’s FDI changes in Central Asian countries on import and export trade. The research results show that China’s FDI to Central Asian countries has a significant trade promotion effect on import and export trade, and the growth of China’s FDI to Central Asian countries will effectively drive the growth of import and export trade. China’s FDI in Kazakhstan and Uzbekistan has a strong trade creation effect. China’s FDI in Kyrgyzstan and Tajikistan has a strong trade substitution effect. China should strengthen economic and trade cooperation with Central Asian countries and expand the scale of FDI. Each country should reduce trade barriers, expand investment fields, and provide favorable policy support for expanding the scale of FDI.

Торговая интеграция в АТР: декомпозиция эффектов

The article uses international statistics to make a comparative assessment of the effects of integration within the Asia-Pacific region, the Western and Eastern macro-zones of the Asia-Pacific region, in terms of the contribution of the processes of globalization and regionalization in 1994–2018 due to trade agreements and their expansion. The resulting assessment of the effects of integration indicated a greater contribution of the globalization process to the growth of trade in the Asia-Pacific region (APR), especially for the countries of the Eastern macro-zone. It was found that in the Eastern macro-zone, the impact of trade agreements hindered the positive effects of integration. The author discovers fundamental differences between the effects occurring from expanding trade agreements. The process of globalization prevailed over regionalization only in the exporting countries of the Eastern macro-zone; the effects from regionalization were stronger for the importing countries compared to the exporters, which indicates the manifestation of the effect of trade diversion in the Eastern macro-zone. Obtained estimates indicate that from 1994 to 2018, the globalization process acted as a necessary condition for the expansion of trade in both the APR as a whole and in its Western macro-zone, while the process of regionalization played an important supporting role. In the Eastern macro-zone the positive effects of globalization compensated for the ambiguous effects of the regionalization, which, possibly, was the reason for the unsuccessful attempts to create trade mega-formats within this macro-zone. At the same time, the Eastern macro-zone countries that were expanding trade agreements (based at the economic framework) have achieved noticeable increase in trade interactions, especially exports. This is why it is assumed that the quality of the trade agreements, which affects the impact from their realization, is crucial as the assessment of the effects from proliferation of trade agreements demonstrate implicit discrimination of the countries that implement moderate policy of reducing trade barriers through trade agreements. Given the small size of domestic markets, the APR countries implementing such policy can only rely on the effects from globalization, which tend to diminish over time

The African Continental Free Trade Area (AfCFTA) and it’s applicability in the West African clime : Nigeria in focus.

The African Union’s (AU) Agenda 2063 dream to create a continental market with the free movement of persons, capital, goods and services became much more promising following the existence of the African continental free trade agreement areas (AfCFTA). This crucial step by the African community is furnished towards creating one African Market to reduce trade barriers, import quotas and tariffs, and increase the trade of goods and services on the continent. By now, the Agreement had already come into force following the 22nd ratification by the Saharawi Republic and Sierra Leone. Moreover, the progression of tthis agreement has been further encouraged by the ratification of Nigeria whose previous absence stood out and raised concerns on the relevance of the Agreement. On this wise, this paper explicates an overview of the AfCFTA agreement and further gives the implications of this agreement in the African clime with a rapt focus on the Federal Republic of Nigeria.

Does the WTO exacerbate international conflict?

As one component of its mission to reduce trade barriers and encourage the liberalization of international commerce, the World Trade Organization provides states with a forum in which they can raise and resolve complaints about partners’ unfair trading practices. This mechanism streamlines the process of identifying non-compliant behavior, and provides real incentives for the removal of such policies. By furnishing a form of dispute resolution, the institution should be both trade-inducing and peace-enhancing for member states. However, this very mechanism also has the potential to aggravate existing dispute for two reasons. First, it removes the opportunity for states to use economic policies as instruments of structural linkage in resolving disputes. Second, it deprives its members of powerful economic tools that could be used in lieu of militarized responses. Using the implementation of the WTO Dispute Settlement mechanism, as well as the subsequent expiration of Article 13 of the WTO Agreement on Agriculture (the so-called ‘peace clause’), we examine whether the opportunity to resolve trade disputes through the organization affects the likelihood that member states engage in militarized conflict with one another. We find that membership in a trade institution facilitates peaceful interaction, but that judicialization erases these benefits. We conclude that institution building requires caution and attention to the possibility of unintended consequences.

Differential Effectiveness of Regional Trade Agreements, 1958-2012: The Conditioning Effects from Homophily and World-System Status

ABSTRACT Borrowing insights from economic sociology and world system theory, this study highlights the dual “embeddedness” of regional trade agreements (RTAs) and examines the contingent nature of their trade-promoting effect. While overall RTAs are found to promote bilateral trade, the trade-promoting effect varies. First, RTAs are embedded in dyadic homophily. Geographic, political, and cultural proximity provides a favorable institutional environment for the materialization of the trade-expanding potential unleashed by RTAs. Most RTAs are predominantly focused on reducing trade barriers and are far less effective in creating effective institutions (especially informal institutions), thereby rendering the actual effectiveness of RTAs dependent on dyadic homophily. Second, RTAs are also embedded in the overall world system. RTAs between wealthy core countries boost trade more effectively than those between less developed peripheral countries. Peripheral countries have limited economic power and lack the capacity or intention to fully implement policies stipulated in RTAs. Overall, the dual “embeddedness” and its resulting differential effectiveness of RTAs is expected to intensify regionalism and the North-South divide in global trade.

Analytical Study on the Impact of GST on Retail Sector: With Reference to Dmart Financial Performance

The imminent implementation of Goods & Services Tax (GST) is expected to result in greater transparency, an improved flow of credit, and reduced trade barriers from a tax perspective. The timely release and revision of the draft GST model law, GST rules, and documentation templates reflect the government’s commitment and keenness to implement the GST law in India in 2017. It is also widely agreed that GST will usher in a series of changes to how businesses will operate and the Retail Industry will be no exception. This thought piece highlights some of the key areas impacted and a number of changes that the industry will need to imbibe over the coming months to ensure that GST is effectively implemented.

China’s Rebalancing

Asia and Latin America and the Caribbean (LAC), two regions with large growth potential, have become increasingly connected over the last 20 years. China has emerged not only as a top trading partner, but also as an important competitor of LAC exports. China’s retreat from certain markets, due to the ongoing rebalancing process, could open new opportunities for LAC exporters but also entail some challenges. Our results show that China’s rebalancing will have an overall positive effect on LAC’s GDP and exports in the long run, but this effect is small and uneven across countries, leading to winners and losers. We also provide evidence that other countries, such as India, are currently trying to fill the gap left by China and could undermine LAC’s competitive advantage in some export markets. In this context, reduction of trade barriers and further integration within the region and/or with the rest of the world would lead to unequivocally positive outcomes for all LAC countries. The COVID-19 shock might exacerbate the effects identified in our analysis.

The Trade (Policy) Discourse in Top Economics Journals

ABSTRACT In the aftermath of recent populist upheavals in Europe, nationalist economic policies challenge the overly positive view on economic integration and the reduction of trade barriers established by standard economic theory. For quite a long time the great majority of economists supported trade liberalisation policies, at least those actively engaged in policy advice or public debates. In this paper, we examine the elite economics discourse on trade policies during the last 20 years regarding specific characteristics of authors, affiliations, citation patterns, the overall attitude towards trade, as well as the methodological approach applied in these papers. Our analysis yields the following results: First, the hierarchical structure of economics also manifests in the debate about trade. Second, while we found some indications of a shift towards more empirically oriented work, quite often empirical data is solely used to calibrate models rather than to challenge potentially biased theoretical assumptions. Third, top economic discourses on trade are predominantly characterised by a normative bias in favour of trade-liberalisation-policies. Forth, we found that other-than-economic impacts and implications of trade policies (political, social and cultural as well as environmental issues) to a great extent either remain unmentioned or are rationalised by means of pure economic criteria.

Linking Information Communication Technology, trade globalization index, and CO2 emissions: evidence from advanced panel techniques.

Previous studies consider ICT a two-edged sword that can harm or benefit the environment. In recent years, ICT penetration has considerably increased in the ASEAN-6 countries and the leaders of ASEAN are willing to bring a digital revolution by increasing ICT infrastructure and reducing trade barriers in the region under the Master Plan of ASEAN Connectivity-2025. Hence, this paper explores the effect of ICT and the recently developed trade globalization index on CO2 emissions in ASEAN-6 countries. The study relies on advanced panel econometric approaches, including Westerlund (2007, 2008) and Pedroni cointegration tests, CUP-FM long-run method, and panel DH causality approach. The results suggest cointegration among variables. The results of CUP-FM indicate that ICT contributes to improving environmental quality by mitigating CO2 emissions. Similarly, trade globalization is also sustainable in the region as it reduces emissions. The results are also confirmed by using the CUP-BC estimator. The findings from the DH causality test unfold causality from ICT and trade globalization index to CO2 emissions. Besides, the long-run estimates reveal the detrimental effect of energy consumption on emissions and the U-shaped association between GDP and emissions. Moreover, unidirectional causality from ICT to trade globalization index and energy consumption indicates that ICT influences trade globalization and energy consumption. Finally, environmental policies in the context of ASEAN are extensively discussed.

Has the Construction of the Free Trade Zone Increased the Enterprise's Total Factor Productivity—Evidence from Generalized Synthetic Control

The Free Trade Zone(FTZ) is a new policy for China to open wider to the outside world. Reducing trade barriers and promoting high-quality enterprise development is an important part of the construction of the FTZ. This article takes the construction of the FTZ based on From 2004 to 2018 as a quasi-natural experiment. The study found that: (1) The policy evaluation results show that after controlling the time and individual effects, the construction of the FTZ plays a significant role in promoting TFP. (2) The construction of the FTZ can promote the improvement of TFP through innovation-driven effects and resource allocation adjustment effects. The analysis shows that patents and the return on assets play an intermediary role between the FTZ and TFP. (3) After considering the time and industry effects, the construction of the FTZ has a significant impact on the TFP growth in state-owned enterprises; the general synthetic control method was used to investigate 11 FTZ, and the construction of Shanghai free trade zone has the most significant effect on the promotion of TFP. The main innovation of this article is the establishment of the FTZ has carried out a policy effect evaluation on the promotion effect of TFP, and has conducted a robustness test using the multi-phase DID method. It has a guiding significance for improving the construction of FTZ and promoting the improvement of enterprise TFP.

Trade Policy in American Economic History

This article reviews the broad changes in US trade policy over the course of the nation's history. Import tariffs have been the main instrument of trade policy and have had three main purposes: to raise revenue for the government, to restrict imports and protect domestic producers from foreign competition, and to reach reciprocity agreements that reduce trade barriers. Each of these three objectives—revenue, restriction, and reciprocity—was predominant in one of three consecutive periods in history. The political economy of these tariffs has been driven by the location of trade-related economic interests in different regions and the political power of those regions in Congress. The review also addresses the impact of trade policies on the US economy, such as the welfare costs of tariffs, the role of protectionism in fostering US industrialization, and the relationship between the Smoot–Hawley Tariff Act and the Great Depression of the 1930s.

Trading for climate resilience

International trade plays an important role in ensuring the resilience of the global food system. Now research suggests a further reduction in trade barriers could alleviate the impacts of climate change on hunger risk.

ASEAN-CANADA FREE TRADE AGREEMENT: POTENTIAL ECONOMIC FOR ASEAN MEMBER COUNTRIES

ASEAN and Canada agreed to establish cooperation as ASEAN-Canada Free Trade Agreement (FTA). This cooperation aims to strengthen economic relations between ASEAN and Canada by eliminating tariff barriers for almost all of trade in goods. Therefore, this study aims to calculate how big the effect of the ASEAN-Canada FTA trade agreement on the macroeconomic conditions of ASEAN member countries. The analysis method used is Computable General Equilibrium (CGE) model using Global Trade Analysis Project (GTAP) version 9A. This cooperation is expected to reduce trade barriers in all sectors, particularly tariff reductions as a representation of declining trade barriers in both ASEAN and Canada. This study analyse two trade policy scenarios by 50% and 100% (full liberalization) tariff reduction. The simulation results show that all ASEAN member countries get the benefit from full liberalization or a 50% tariff reduction on welfare except Laos and Philippines. In addition, this cooperation also can increase the real GDP in all ASEAN member countries and trade balance for Indonesia, Philippines, Singapore, Myanmar and Canada. It also has negative impacts on inflation and investment for some ASEAN member countries such as Brunei Darussalam, Cambodia, Laos, Malaysia and Thailand.