Non-Tariff Measures and the Quality of Imported Products

Abstract

Legitimate reasons for the imposition of non-tariff measures (NTMs) within regulations have triggered their extensive use. Among these measures, technical barriers to trade (TBTs) and sanitary and phytosanitary (SPS) measures allow countries to impose restrictions on the import of low-quality products suspected of harming domestic consumers’ health, plant life, or the environment. This paper analyses two regulative and standard-like NTMs – TBTs and SPS measures – and the quality of traded products that is driven by their imposition, which is a general underlying motive for the adoption of such regulations. A dummy variable measuring the existence of these NTMs and a count variable indicating their stringency are used in the analysis. Moreover, two other variables indicate flows of NTMs imposed in each year and stocks of these NTMs accumulated over years. The results indicate that TBTs and SPS measures do indeed imply a higher quality of traded products. Stringent TBTs with more regulations imposed in each year (i.e. flows of count TBTs) have the largest impact on the quality of traded products. However, for SPS measures, only the existence of a regulation (i.e. the dummy variable on flows of SPS measures) on a traded product has the strongest impact on its quality.

Revisiting the impact of per‐unit duties on agricultural export prices

“…5 The decline in transportation costs and the increasing attention to food quality call for a better understanding of the role of the duties in those high-quality products (which are mainly produced by developed countries), tend to be both highly priced and highly protected, implying ambiguous and dynamic effects on trade (Hummels, 2007). Tariff escalation and participation in GVCs are also aspects that deserve further investigation: upstream and high-priced products are more protected in developed countries, and this may, in turn, explain (with a reserve causality logic) the positive correlation of ad valorem duties and exports (Cheng, 2007;Ghodsi & Stehrer, 2022). 6 Due to the host of fixed effects and the large number of observations, we estimate all the models (IV and OLS) using the standard least squares dummy variable estimator.…”

Technical regulation and trade: Export quality matters

“…higher ). In other words, conditional on a given number of technical regulations, higher‐income countries will display a higher preference for quality, operating through a tighter control of conformity assessment for the existing technical regulations (Feenstra & Romalis, 2014; Ghodsi & Stehrer, 2020).…”

Revisiting the Impact of Per-Unit Duties on Agricultural Export Prices

“…Product quality affects not only firms' business strategies, but also countries' trade policy interventions. For instance, trade measures, such as tariffs and non-tariff measures, tend to be levied on specific types of products (i.e., high-quality products) (Ghodsi and Stehrer, 2022), and therefore have heterogeneous impacts on the extent to which developing and developed countries participate in global markets. Whether these trade costs are per-unit or ad-valorem determines how they affect trade patterns.…”

“…5 The decline in transportation costs and the increasing attention to food quality call for a better understanding of the role of the duties, in that, high-quality products (which are mainly produced by developed countries), tend to be both highly priced and highly protected, implying ambiguous and dynamic effects on trade (Hummels, 2007). Tariff escalation and participation in GVCs are also aspects that deserve further investigation: upstream and high-priced products are more protected in developed countries, and this may, in turn, explain (with a reserve causality logic) the positive correlation of ad-valorem duties and exports (Cheng, 2007;Ghodsi and Stehrer, 2022).…”