Publication: The Effect of Product Standards on Agricultural Exports from Developing Countries
Date
2013-06
ISSN
Published
2013-06
Author(s)
Ferro, Esteban
Wilson, John S.
Otsuki, Tsunehiro
Abstract
The authors create a standards
restrictiveness index using newly available data on maximum
residue levels of pesticides for 61 importing countries. The
paper analyzes the impact that food safety standards have on
international trade of agricultural products. The findings
suggest that more restrictive standards are associated, on
average, with a lower probability of observing trade.
However, after controlling for sample selection and the
proportion of exporting firms in a gravity model, the
analysis finds that the effect of standards on trade
intensity is indistinguishable from zero. This is consistent
with the assumption that meeting stringent standards
increases primarily the fixed costs of exporting. Once firms
enter the market, however, standards do not impact the level
of exports. The analysis also finds a greater marginal
effect of BRICS (Brazil, Russia, India, China, and South
Africa) standards on the probability of trade, relative to
other countries' standards, keeping in mind however
that on average BRICS standards are less restrictive. The
analysis also suggests that exporters in low-income
countries are more adversely affected by stricter standards.
Link to Data Set
Citation
“Ferro, Esteban; Wilson, John S.; Otsuki, Tsunehiro. 2013. The Effect of Product Standards on Agricultural Exports from Developing Countries. Policy Research Working Paper;No. 6518. © World Bank, Washington, DC. http://hdl.handle.net/10986/15878 License: CC BY 3.0 IGO.”
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