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Non‐Reciprocal Trade Preferences and the Role of Compliance Costs in the Agricultural Sector: Exports to the EU
Author(s) -
Agostino Mariarosaria,
Demaria Federica,
Trivieri Francesco
Publication year - 2010
Publication title -
journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.157
H-Index - 61
eISSN - 1477-9552
pISSN - 0021-857X
DOI - 10.1111/j.1477-9552.2010.00264.x
Subject(s) - proxy (statistics) , beneficiary , margin (machine learning) , agriculture , gravity equation , reciprocal , european union , international economics , business , compliance (psychology) , trade facilitation , economics , sample (material) , gravity model of trade , international trade , bilateral trade , trade barrier , finance , philosophy , law , ecology , linguistics , chemistry , computer science , biology , psychology , social psychology , chromatography , machine learning , political science , china
We investigate whether non‐reciprocal preferential regimes granted by the European Union have an impact on agricultural export flows from beneficiary countries while accounting for the costs of compliance that may prevent exporters from taking full advantage of potential benefits. Compliance costs are heterogeneous and difficult to measure. We proxy their influence and specify a model that allows for a different preferential margin impact according to the proxy costs. Adopting the gravity framework and using a sample of 554 lines of agricultural products for 131 developing countries in 2002, we find that the costs of compliance play a role in making the schemes work: the lower the costs, the greater the impact of the preferential margins. Moreover, the estimated margin effect differs between different regimes.