Calvo-Pardo, HectorFreund, CarolineOrnelas, Emanuel2012-03-192012-03-192009-06-01https://hdl.handle.net/10986/4153Using detailed data on trade and tariffs from 1992-2007, the authors examine how the ASEAN Free Trade Agreement has affected trade with nonmembers and external tariffs facing nonmembers. First, the paper examines the effect of preferential and external tariff reduction on import growth from ASEAN insiders and outsiders across HS 6-digit industries. The analysis finds no evidence that preferential liberalization has led to lower import growth from nonmembers. Second, it examines the relationship between preferential tariff reduction and MFN tariff reduction. The analysis finds that preferential liberalization tends to precede external tariff liberalization. To examine whether this tariff complementarity is a result of simultaneous decision making, the authors use the scheduled future preferential tariff reductions (agreed to in 1992) as instruments for actual preferential tariff changes after the Asia crisis. The results remain unchanged, suggesting that there is a causal relationship between preferential and MFN tariff reduction. The findings also indicate that external liberalization was relatively sharper in the products where preferences are likely to be most damaging, proving further support for a causal effect. Overall, the results imply that the ASEAN agreement has been a force for broader liberalization.CC BY 3.0 IGOADMINISTRATIVE COSTSAGGREGATE TRADEAGRICULTURAL PRODUCTSAVERAGE TARIFFSAVERAGE TRADEBARRIERS ON IMPORTSBILATERAL FLOWSBILATERAL OPPORTUNISMBILATERAL TRADEBILATERAL TRADE AGREEMENTSBLOC IMPORTSBLOC MEMBERSBLOC PARTNERSBLOC TARIFFSBLOC TRADEBUSINESS CYCLECURRENCYCUSTOMSCUSTOMS UNIONCUSTOMS UNION ISSUECUSTOMS UNIONSDEVELOPING COUNTRIESDUTY DRAWBACKDUTY DRAWBACKSDUTY-FREE TREATMENTECONOMIC INTEGRATIONEUROPEAN UNIONEXPORTERSEXTERNAL IMPORTSEXTERNAL LIBERALIZATIONEXTERNAL TARIFFEXTERNAL TARIFFSEXTERNAL TRADEEXTERNAL TRADE BARRIERSEXTERNAL TRADE POLICIESFINAL GOODSFREE ACCESSFREE TRADEFREE TRADE AGREEMENTFREE TRADE AGREEMENTSFREE TRADE AREAFREE TRADE AREASFREE TREATMENTGLOBAL FREE TRADEGLOBAL TRADEGRAVITY EQUATIONGRAVITY MODELGROWING TRADEGROWTH RATEGROWTH RATESHIGH TARIFFSIMPORT BARRIERSIMPORT TARIFFIMPORT-COMPETING SECTORIMPORTED INTERMEDIATEINTERMEDIATE GOODSINTERNAL LIBERALIZATIONINTERNAL TARIFFSINTERNAL TRADEINTERNAL TRADE LIBERALIZATIONINTERNATIONAL BANKINTERNATIONAL ECONOMICSINTERNATIONAL TRADEINTERNATIONAL TRADE POLICYINTRA-ASEAN TRADEINTRABLOC IMPORTSLOBBYINGMARKET ACCESSMFN TARIFFSMULTILATERAL LIBERALIZATIONMULTILATERAL SYSTEMMULTILATERAL TARIFF REDUCTIONMULTILATERAL TRADEMULTILATERAL TRADE LIBERALIZATIONMULTILATERAL TRADE NEGOTIATIONSMULTILATERALISMNON-TARIFF BARRIERSNONMEMBER COUNTRIESPARTNER COUNTRIESPOLICY RESEARCHPOLITICAL CONSIDERATIONSPOLITICAL ECONOMYPREFERENTIAL LIBERALIZATIONPREFERENTIAL MARGINPREFERENTIAL MARGINSPREFERENTIAL RATEPREFERENTIAL RATESPREFERENTIAL TARIFFPREFERENTIAL TARIFF REDUCTIONPREFERENTIAL TARIFFSPREFERENTIAL TRADEPREFERENTIAL TRADE AGREEMENTSPREFERENTIAL TRADINGPREFERENTIAL TRADING AREASPREFERENTIAL TREATMENTPRICE EFFECTSPRODUCT LEVELPROTECTIONISTPROTECTIONIST BIASREGIONAL BLOCSREGIONAL INTEGRATIONREGIONAL TRADEREGIONAL TRADE AGREEMENTREGIONAL TRADE AGREEMENTSREGIONAL TRADE BLOCSREGIONAL TRADE LIBERALIZATIONREGIONAL TRADING PARTNERSREGIONALISMRULES OF ORIGINSTANDARD ERRORSTARIFF ADJUSTMENTSTARIFF BARRIERSTARIFF CHANGESTARIFF LIBERALIZATIONTARIFF NEGOTIATIONSTARIFF ON IMPORTSTARIFF RATESTARIFF REDUCTIONTARIFF REDUCTIONSTARIFF REVENUETRADE AGREEMENTTRADE BLOCTRADE BLOCSTRADE CREATINGTRADE CREATIONTRADE DATATRADE DIVERSIONTRADE EFFECTSTRADE FLOWSTRADE GROWTHTRADE IMPACTTRADE INTEGRATIONTRADE LIBERALIZATIONTRADE NEGOTIATIONSTRADE PARTNERSTRADE PATTERNSTRADE POLICIESTRADE POLICYTRADE PREFERENCESTRADE REFORMTRADE RESTRICTIONSTRADE SYSTEMTRADE TAXESTRADING BLOCSTRADING PARTNERSTRADING SYSTEMTRANSACTION COSTSWORLD ECONOMYWORLD TRADEWORLD TRADE ORGANIZATIONWorld Bank10.1596/1813-9450-4960