Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2005-07-07
Number: 05-073/2
Author-Name: J. Francois
Author-Email: francois@few.eur.nl
Author-Workplace-Name: Faculty of Economics, Erasmus Universiteit Rotterdam, and CEPR
Author-Name: B. Hoekman
Author-Workplace-Name: World Bank, Institut d'Etudes Politiques, Paris, and CEPR
Author-Name: M. Manchin
Author-Email: manchin@few.eur.nl
Author-Workplace-Name: Faculty of Economics, Erasmus Universiteit Rotterdam
Title: Preference Erosion and Multilateral Trade Liberalization
Abstract: Because of concern that OECD tariff reductions will translate intoworsening export performance for the least developed countries, trade preferences haveproven a stumbling block to developing country support for multilateral liberalization.We examine the actual scope for preference erosion, including an econometricassessment of the actual utilization, and also the scope for erosion estimated by modelingfull elimination of OECD tariffs and hence full MFN liberalization-based preferenceerosion. Preferences are underutilized due to administrative burden -estimated to be atleast 4 percent on average- reducing the magnitude of erosion costs significantly. Forthose products where preferences are used (are of value), the primary negative impactfollows from erosion of EU preferences. This suggests the erosion problem is primarilybilateral rather than a WTO-based concern.
Classification-JEL: F13
Keywords: preference erosion; GSP; WTO; Doha Round; trade and development
File-Url: https://papers.tinbergen.nl/05073.pdf
File-Format: application/pdf
File-Size: 210676 bytes
Handle: RePEc:tin:wpaper:20050073