Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/173011
Authors: 
Heid, Benedikt
Larch, Mario
Yotov, Yoto V.
Year of Publication: 
2017
Series/Report no.: 
CESifo Working Paper 6735
Abstract: 
We propose a simple method to identify the effects of unilateral and non-discriminatory trade policies on bilateral trade within a theoretically-consistent empirical gravity model. Specifi-cally, we argue that structural gravity estimations should be performed with data that include not only international trade flows but also intra-national trade flows. The use of intra-national sales allows identification of the effects of non-discriminatory trade policies on the importer side (e.g. most favored nation tariffs) and on the exporter side (e.g. export subsidies), even in the presence of exporter and importer fixed effects. An important byproduct of our approach is that it can be used to recover estimates of the export-supply elasticity and of the import-demand elasticity. We demonstrate the effectiveness of our techniques in the case of MFN tariffs and “Time to Export” as representative determinants of trade on the importer and on the exporter side, respectively. Our methods can be extended to quantify the impact on trade of any country-specific characteristics as well as any non-trade policies.
Subjects: 
gravity model
non-discriminatory trade policies
tariffs
subsidies
time to export
trade elasticity of substitution
JEL: 
F10
F13
F14
F47
Document Type: 
Working Paper
Social Media Mentions:

18



Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.