Preferential Trading Arrangements in Agricultural and Food Markets

Purpose The purpose of this article is to provide empirical evidence about the potential positive effects of switching from given non-reciprocal trade preferences granted under the Swiss Generalized System of Preferences (GSP) for developing countries (DCs) to negotiated reciprocal trade preferences under a Free Trade Agreement (FTA). Design/methodology/approach In a case study of Tunisia’s exports to Switzerland, the authors apply methods of matching econometrics, namely, Propensity-Score Matching and Nearest-Neighbor Matching. Hereby, they are able to identify the average treatment effect on the treated. Findings Overall preferential exports increased by 125 per cent after the entry into force of the FTA in 2005 until the end of the observation period in 2011. Additionally, an analysis of the agro-food and textile sectors likewise indicate boosting preferential exports in the amount of 100 per cent. Research limitations/implications Case studies in this vein have their disadvantages. The greatest disadvantage is the lack of generalization. In contrast to studies estimating the potential effects of an FTA for several countries, the authors are not able to generalize their results based on a single case. Practical implications Because trade preferences under the Swiss GSP are offered to the country group of DCs as a whole, non-reciprocal trade preferences are not tailored to the export structure of a particular DC. By switching from non-reciprocal to negotiated reciprocal trade preferences, DCs such as Tunisia expect to negotiate terms which are tailored to their export structure as well as better conditions than competitors from countries which are still beneficiaries of the GSP. Originality/value To the authors’ knowledge, this is the first study to investigate explicitly the switch from non-reciprocal to reciprocal trade preferences using econometric matching techniques.

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Good governance and preferential trade: evidence from the Swiss generalized system of preferences

Ritzel

Köhler

Mann

2018

IJSE

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Purpose The purpose of this paper is to determine if the institutional quality of developing countries (DCs) and least-developed countries (LDCs) contributes to a significant increase in the utilization rate of the Swiss generalized system of preferences in the agro-food sector. Design/methodology/approach The authors use state of the art regression techniques accounting for zero values to identify if the institutional quality – separately depicted by the Worldwide Governance Indicators, the Index of Economic Freedom and the Human Development Index – can contribute in overcoming non-tariff barriers (NTBs) to trade. Findings The institutional quality exerts a consistent positive effect on the level of utilization of trade preferences. Research limitations/implications Swiss food trade represents, of course, only a very small share of world trade, therefore it would be worthwhile to extend the analysis to other countries and sectors. Practical implications Industrialized countries’ development policies should more strongly focus on capacity building in DCs and LDCs to strengthen trade-related institutions. Originality/value The study focuses on an often underemphasized element in international trade relations – the role of the institutional quality in overcoming NTBs to trade.

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Preferential Trading Arrangements in Agricultural and Food Markets

Abstract: NTR Normal Trade Relations Tariffs (name given to MFN in the US tariff system) OCT(s) Overseas Countries and Territories ODC Other duties and charges (in addition to customs duties) OECD Organisation for Economic Co-operation and Development PANEURO Pan-

Cited by 7 publications

References 14 publications

Trade Impact of European Union Preferences: The Role of Compliance Costs

Trade Impact of European Union Preferences: The Role of Compliance Costs

Integrating developing countries into the world economy: a Tunisian case study

Good governance and preferential trade: evidence from the Swiss generalized system of preferences

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