Non-Tariff Measures, Import Competition, and Exports
The empirical evidence on the impact of import competition on economic performance relies mainly on import tariff liberalization as the source of changes to competition. This paper extends this evidence by focusing on non-tariff measures, an increa...
| Main Authors: | , |
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| Language: | English |
| Published: |
World Bank, Washington, DC
2021
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/undefined/994091633707638412/Non-Tariff-Measures-Import-Competition-and-Exports http://hdl.handle.net/10986/36387 |
| Summary: | The empirical evidence on the impact
of import competition on economic performance relies mainly
on import tariff liberalization as the source of changes to
competition. This paper extends this evidence by focusing on
non-tariff measures, an increasingly important trade policy
tool globally. The analysis examines the competition effect
of four specific non-tariff measures on the exporting
activity of the universe of Indonesian firms. The focus is
on measures that do not clearly address any negative
externalities of imports—the supposed objective of
non-tariff measures—and hence appear to be protectionist in
nature. The results suggest that by restricting import
competition, these measures reduce the survival of firms in
export markets as well as the intensive and extensive
margins of their exports. Non-tariff measures have a more
negative effect than import tariffs in most cases and these
results are robust to various checks. The analysis provides
suggestive evidence that markups are an important channel
through which these effects are mediated. |
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