Domestic distortions and international trade
Domestic distortions and international trade
In this paper, we investigate techniques for measuring the trade policy equivalent of domestic distortions, using a distance function approach. Our measure, the Trade Restrictiveness Index, is shown to equal the uniform tariff which is welfare-equivalent to a given pattern of domestic taxes and subsidies. We extend the Index to incorporate taxes in markets for non-traded goods and factors of production and illustrates its operationality with an application to liberalisation in Mexican agriculture. We conclude that our Index has considerable potential in empirical work and as an aid to trade negotiations.
A hard copy is available in UCD Library at GEN 330.08 IR/UNI
World Bank
- University of Oxford United Kingdom
- University College Dublin Ireland
Trade policy; Domestic distortions; Producer and consumer subsidy equivalents; Trade restrictiveness index; Commercial policy; International trade, Commercial policy, Access to Markets,TF054105-DONOR FUNDED OPERATION ADMINISTRATION FEE INCOME AND EXPENSE ACCOUNT,Markets and Market Access,Environmental Economics&Policies,Economic Theory&Research, Producer and consumer subsidy equivalents, Trade restrictiveness index, Trade policy, F10, International trade, Consumer Subsidy; Domestic Distortions; Producer Subsidy; Trade Policy; Trade Restrictiveness Index, F13, Domestic distortions, jel: jel:F10, jel: jel:F13
Trade policy; Domestic distortions; Producer and consumer subsidy equivalents; Trade restrictiveness index; Commercial policy; International trade, Commercial policy, Access to Markets,TF054105-DONOR FUNDED OPERATION ADMINISTRATION FEE INCOME AND EXPENSE ACCOUNT,Markets and Market Access,Environmental Economics&Policies,Economic Theory&Research, Producer and consumer subsidy equivalents, Trade restrictiveness index, Trade policy, F10, International trade, Consumer Subsidy; Domestic Distortions; Producer Subsidy; Trade Policy; Trade Restrictiveness Index, F13, Domestic distortions, jel: jel:F10, jel: jel:F13
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