Non-Tariff Trade Policy in the Context of Deep Trade Integration: An Ex-Post Gravity Model Application to the EU-South Korea Agreement

Grübler, Julia; Reiter, Oliver

doi:10.11644/kiep.eaer.2021.25.1.390

Cited by 8 publications

(10 citation statements)

References 26 publications

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“…In particular, there is no significant effect on imports of Computer, Electronic and Optical Equipment and Electrical Equipment (see their Table 91), which are quantitatively important sectors (see below). Grübler and Reiter (2021) find that the EU-South Korea FTA increases bilateral trade on average by 9.42%, which is smaller than my estimate. In their regressions, they do neither account for anticipation nor for delayed effects.…”

Section: Introductioncontrasting

confidence: 83%

The Trade Effects of the EU-South Korea Free Trade Agreement: Heterogeneity Across Time, Country Pairs, and Directions of Trade within Country Pairs

Jung

2022

Open Econ Rev

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The EU-South Korea Free Trade Agreement, which entered into force in 2015, is an example of so-called “second-generation” regional trade agreements. Using the gravity equation and drawing on a novel dataset on trade in manufacturing goods (Monteiro in World Trade Organization, Geneva, 2020), I explore the heterogeneity in the trade effects of this agreement across time (anticipation and phasing-in/delayed adjustment), country pairs, and across trading directions within pairs (exports versus imports). First, the positive trade effect after the announcement vanished one year prior to entry into force. Second, on average exports of EU countries to South Korea rise, while imports of EU countries are not significantly affected, potentially reflecting differences in ex ante trade policies. Third, additional imports caused by the agreement are larger for those EU countries where South Korea accounted for a large share of extra-EU imports already before the agreement.

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Section: Introductioncontrasting

confidence: 83%

The Trade Effects of the EU-South Korea Free Trade Agreement: Heterogeneity Across Time, Country Pairs, and Directions of Trade within Country Pairs

Jung

2022

Open Econ Rev

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“…In our second addition, we want to identify products that are often targeted by non-tariff measures. As Grübler and Reiter ( 2021 ) show, TBT STC and SPS STC 4 are the two types of non-tariff measures that have the most consistently negative effect on trade flows. We compute the fraction of world trade (for a given product) that is affected by one of the two measures as where is a dummy variable indicating whether the flow between exporter i and importer j is affected by a TBT STC or SPS STC.…”

Section: Methodsmentioning

confidence: 96%

Assessing the importance of risky products in international trade and global value chains

Reiter

Stehrer

2022

Empirica

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The COVID-19 pandemic has thrown the world's economy and trade into disarray, putting international reliance in the limelight. This sparked debate on the durability and resilience of global value chains. In this paper, we construct a ‘product riskiness indicator’ for 4700 globally traded products based on components such as market concentration, clustering tendencies, network centrality of players, or international substitutability to determine which products are vulnerable to trade shocks at the global level – referred to as ‘risky’ products. In a second step, bilateral risky product imports are matched to multi-country input–output tables, allowing for an examination of the importance of globally supplied risky products by country and industry. Due to the high percentage of dangerous products in high-tech product categories, higher-tech industries are more vulnerable to supply-chain vulnerabilities. Third, we analyse the GDP impact of reshoring using a “partial global extraction method.” Assuming that risky product imports from non-EU27 nations are re-shored to EU27 countries, the EU27 GDP might rise by up to 0.5 percent. Non-EU27 countries suffer as a result of such reshoring activity. This implies that ensuring robust or at least resilient supply networks is also in the interest of the supplier countries and sectors.

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“…My simulations are based on the 2014 World Input-Output Table, as this is the most recent country-and sector-level dataset available and is also used as a standard source for trade policy analysis with input-output linkages in recent papers such as Eppinger et al (2021), Antràs and Chor (2021), and Grübler and Reiter (2021).…”

Section: Baseline Equilibriamentioning

confidence: 99%

“…Far more research has been conducted on other FTAs such as the EU-Japan Economic Partnership Agreement or the EU-South Korea FTA. Chowdhry and Felbermayr (2021) focus on the EU-South Korea trade agreement from the French perspective, Grübler and Reiter (2021) study the impact of tariffs and non-tariff measures (NTMs) of the EU-South Korea FTA. A comprehensive analysis is done by Civic Consulting and Ifo Institute (2018) who rely on the World Input-Output Database (WIOD).…”

Section: Introductionmentioning

confidence: 99%

Trade and welfare effects of a potential free trade agreement between Japan and the United States

Walter

2022

Rev World Econ

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This paper addresses the trade and welfare implications of a bilateral trade agreement between the U.S. and Japan. In 2019, the two countries signed a “stage one” trade agreement, with the U.S.-Japan Trade Agreement (USJTA) and the U.S.-Japan Digital Trade Agreement as two small trade agreements. A comprehensive bilateral free trade agreement (FTA) is currently under discussion between Washington and Tokyo, with the U.S. government alternatively joining the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP). Based on the theoretical model of Caliendo and Parro (Rev Econ Stud, 82(1):1–44, 2015) , I analyze the welfare gains of such a bilateral FTA in the style of Aichele et al. (Where is the value added? China’s WTO entry, trade and value chains, ZBW-Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz, 2014). I simulate trade and welfare impacts for the USJTA and the U.S.-Japan Digital Trade Agreement, as well as for a deep bilateral FTA. In addition, I examine and compare the welfare implications of the established CPTPP with the scenario of the U.S. or China joining CPTPP. My findings show that Japan’s welfare increases by 0.3% and U.S. welfare increases by 0.14% as a result of the FTA. Welfare of both countries would increase if the U.S. entered CPTPP, with Japanese welfare being even higher if China acceded to CPTPP.

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Non-Tariff Trade Policy in the Context of Deep Trade Integration: An Ex-Post Gravity Model Application to the EU-South Korea Agreement

Cited by 8 publications

References 26 publications

The Trade Effects of the EU-South Korea Free Trade Agreement: Heterogeneity Across Time, Country Pairs, and Directions of Trade within Country Pairs

The Trade Effects of the EU-South Korea Free Trade Agreement: Heterogeneity Across Time, Country Pairs, and Directions of Trade within Country Pairs

Assessing the importance of risky products in international trade and global value chains

Trade and welfare effects of a potential free trade agreement between Japan and the United States

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