Journal Article

Trade Preferences to Small Developing Countries and the Welfare Costs of Lost Multilateral Liberalization

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collection.link.102
https://openknowledge.worldbank.org/handle/10986/2211
collection.name.102
A. World Bank Economic Review
dc.contributor.author
Limão, Nuno
dc.contributor.author
Olarreaga, Marcelo
dc.date.accessioned
2013-12-20T20:03:07Z
dc.date.available
2013-12-20T20:03:07Z
dc.date.issued
2006-05-17
dc.date.lastModified
2021-04-23T14:03:29Z
dc.description.abstract
The proliferation of preferential trade liberalization over the last 20 years has raised the question of whether it slows multilateral trade liberalization. Recent theoretical and empirical evidence indicates that this is the case even for unilateral preferences that developed countries provide to small and poor countries, but there is no estimate of the resulting welfare costs. This stumbling block effect can be avoided by replacing the unilateral preferences with a fixed import subsidy, which generates a Pareto improvement. More importantly, this paper presents the first estimates of the welfare cost of preferential liberalization as a stumbling block to multilateral liberalization. Recent estimates of the stumbling block effect of preferences with data for 170 countries and more than 5,000 products are used to calculate the welfare effects of the European Union, Japan, and the United States switching from unilateral preferences for least developed countries to an import subsidy scheme. In a model with no dynamic gains to trade, the switch produces an annual net welfare gain for the 170 countries that adds about 10 percent to the estimated trade liberalization gains in the Doha Round. It also generates gains for each group: the European Union, Japan, and the United States ($2,934 million), least developed countries ($520 million), and the rest of the world ($900 million).
en
dc.identifier
http://documents.worldbank.org/curated/en/2006/05/17753325/trade-preferences-small-developing-countries-welfare-costs-lost-multilateral-liberalization
dc.identifier.citation
World Bank Economic Review
dc.identifier.other
doi:10.1093/wber/lhj013
dc.identifier.uri
http://hdl.handle.net/10986/16431
dc.language
English
dc.language.iso
en_US
dc.publisher
Oxford University Press on behalf of the World Bank
dc.rights
CC BY-NC-ND 3.0 IGO
dc.rights.holder
World Bank
dc.rights.uri
http://creativecommons.org/licenses/by-nc-nd/3.0/igo
dc.subject
ABSOLUTE VALUE
dc.subject
ACCORDS
dc.subject
AD VALOREM
dc.subject
ADJUSTMENT ASSISTANCE
dc.subject
AGRICULTURAL SECTOR
dc.subject
AGRICULTURE
dc.subject
BALANCE OF PAYMENTS
dc.subject
BENCHMARK
dc.subject
BILATERAL TRADE
dc.subject
COMPARATIVE ADVANTAGE
dc.subject
COMPETITIVE POSITION
dc.subject
CONCESSIONS
dc.subject
CONSTANT RETURNS TO SCALE
dc.subject
CUSTOMS
dc.subject
DEMAND ELASTICITIES
dc.subject
DEVELOPED COUNTRIES
dc.subject
DEVELOPING COUNTRIES
dc.subject
DEVELOPMENT ASSISTANCE
dc.subject
DIFFERENTIAL TREATMENT
dc.subject
DIRECT TRANSFERS
dc.subject
DOMESTIC PRICE
dc.subject
ECONOMIC POLICIES
dc.subject
ECONOMIC POLICY
dc.subject
ECONOMIC RELATIONS
dc.subject
ECONOMIC RESEARCH
dc.subject
ELASTICITY
dc.subject
ENVIRONMENTAL STANDARDS
dc.subject
EQUILIBRIUM
dc.subject
EUROPEAN UNION
dc.subject
EXPORT MARKETS
dc.subject
EXPORT PRICE
dc.subject
EXPORT REVENUE
dc.subject
EXPORT SPECIALIZATION
dc.subject
EXPORT SUPPLY
dc.subject
EXPORTERS
dc.subject
EXPORTS
dc.subject
EXTERNALITIES
dc.subject
EXTERNALITY
dc.subject
FOREIGN PRODUCER
dc.subject
FREE TRADE
dc.subject
FREE TRADE AGREEMENT
dc.subject
FREE-TRADE AGREEMENTS
dc.subject
FUTURE RESEARCH
dc.subject
GDP
dc.subject
GENERAL AGREEMENT ON TARIFFS
dc.subject
GENERAL EQUILIBRIUM
dc.subject
GENERAL EQUILIBRIUM MODEL
dc.subject
GENERALIZED SYSTEM OF PREFERENCES
dc.subject
GLOBAL ECONOMY
dc.subject
GLOBAL TRADE
dc.subject
GLOBAL TRADING
dc.subject
HUMAN RIGHTS
dc.subject
IMPORT DUTIES
dc.subject
IMPORT TARIFFS
dc.subject
INDUSTRIALIZED COUNTRIES
dc.subject
INEQUALITY
dc.subject
INFANT INDUSTRY
dc.subject
INFANT INDUSTRY ARGUMENT
dc.subject
INTELLECTUAL PROPERTY
dc.subject
INTELLECTUAL PROPERTY PROTECTION
dc.subject
INTERNATIONAL BANK
dc.subject
INTERNATIONAL ECONOMICS
dc.subject
INTERNATIONAL TRADE
dc.subject
INTERNATIONAL TRADE COMMISSION
dc.subject
INTERNATIONAL TRADE POLICY
dc.subject
LDCS
dc.subject
LEGAL PERSPECTIVE
dc.subject
LESS DEVELOPED COUNTRIES
dc.subject
MARKET ACCESS
dc.subject
MARKET INTEGRATION
dc.subject
MOST FAVORED NATION
dc.subject
MULTILATERAL LIBERALIZATION
dc.subject
MULTILATERAL TARIFFS
dc.subject
MULTILATERAL TRADE
dc.subject
MULTILATERAL TRADE LIBERALIZATION
dc.subject
NATIONAL BUREAU
dc.subject
NET EXPORTS
dc.subject
PERFECT COMPETITION
dc.subject
POLICY RESEARCH
dc.subject
POLITICAL ECONOMY
dc.subject
PREFERENTIAL ACCESS
dc.subject
PREFERENTIAL AGREEMENT
dc.subject
PREFERENTIAL AGREEMENTS
dc.subject
PREFERENTIAL MARGIN
dc.subject
PREFERENTIAL MARGINS
dc.subject
PREFERENTIAL TARIFF
dc.subject
PREFERENTIAL TARIFFS
dc.subject
PREFERENTIAL TRADE
dc.subject
PREFERENTIAL TRADE AGREEMENT
dc.subject
PREFERENTIAL TRADE AGREEMENTS
dc.subject
PREFERENTIAL TRADE ARRANGEMENTS
dc.subject
PREFERENTIAL TRADE LIBERALIZATION
dc.subject
PREFERENTIAL TREATMENT
dc.subject
PREFERENTIAL ~ TRADE
dc.subject
PREFERENTIAL ~ TRADE AGREEMENTS
dc.subject
PRICE EFFECTS
dc.subject
PRICE SUPPORT
dc.subject
RECIPROCITY
dc.subject
REGIONAL INTEGRATION
dc.subject
REGIONALISM
dc.subject
RULES OF ORIGIN
dc.subject
SPECIALIZATION
dc.subject
TARIFF CHANGES
dc.subject
TARIFF DATA
dc.subject
TARIFF LINE
dc.subject
TARIFF PREFERENCE
dc.subject
TARIFF PREFERENCES
dc.subject
TARIFF RATE
dc.subject
TARIFF REDUCTION
dc.subject
TARIFF REDUCTIONS
dc.subject
TARIFF REVENUE
dc.subject
TAX RATE
dc.subject
TERMS OF TRADE
dc.subject
TERMS OF TRADE EFFECTS
dc.subject
TRADE BARRIERS
dc.subject
TRADE DISTORTIONS
dc.subject
TRADE EFFECT
dc.subject
TRADE FLOWS
dc.subject
TRADE INTEGRATION
dc.subject
TRADE MODEL
dc.subject
TRADE NEGOTIATORS
dc.subject
TRADE OBJECTIVES
dc.subject
TRADE PREFERENCE
dc.subject
TRADE PREFERENCES
dc.subject
TRADE REFORM
dc.subject
TRADING PARTNERS
dc.subject
TRANSPORT COSTS
dc.subject
UNILATERAL PREFERENCES
dc.subject
UNILATERAL TRADE
dc.subject
URUGUAY ROUND
dc.subject
VALUE OF IMPORTS
dc.subject
WELFARE GAINS
dc.subject
WORKER RIGHTS
dc.subject
WORLD MARKET
dc.subject
WORLD MARKETS
dc.subject
WORLD PRICE
dc.subject
WORLD PRICES
dc.subject
WORLD TRADE
dc.subject
WORLD TRADE ORGANIZATION
dc.subject
WORLD TRADING SYSTEM
dc.subject
WTO
dc.title
Trade Preferences to Small Developing Countries and the Welfare Costs of Lost Multilateral Liberalization
en
dc.type
Journal Article
en
okr.date.disclosure
2013-05-24
okr.doctype
Publications & Research :: Journal Article
okr.doctype
Publications & Research :: Journal Article
okr.docurl
http://documents.worldbank.org/curated/en/2006/05/17753325/trade-preferences-small-developing-countries-welfare-costs-lost-multilateral-liberalization
okr.globalpractice
Macroeconomics and Fiscal Management
okr.globalpractice
Governance
okr.globalpractice
Trade and Competitiveness
okr.globalpractice
Trade and Competitiveness
okr.googlescholar.linkpresent
yes
okr.identifier.doi
10.1093/wber/lhj013
okr.identifier.externaldocumentum
000333037_20130524150826
okr.identifier.internaldocumentum
17753325
okr.identifier.report
77521
okr.journal.nbpages
217-240
okr.language.supported
en
okr.pdfurl
http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2013/05/24/000333037_20130524150826/Rendered/PDF/775210JRN020060C00Trade0Preferences.pdf
en
okr.peerreview
Academic Peer Review
okr.relation.associatedurl
https://openknowledge.worldbank.org/handle/10986/9022
okr.topic
Law and Development :: Trade Law
okr.topic
International Economics and Trade :: International Trade and Trade Rules
okr.topic
International Economics and Trade :: Free Trade
okr.topic
International Economics and Trade :: Trade Policy
okr.topic
Economic Theory and Research
okr.topic
Macroeconomics and Economic Growth
okr.unit
Transport (LCSTR)
okr.volume
20(2)

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