Protectionism indices for non-tariff measures: An application to maximum residue levels

Abstract

We propose aggregation indices of Non-Tariff Measures (NTMs) to quantify their protectionism relative to international standards. We apply the indices to national Maximum Residue Limit (MRL) regulations affecting agricultural and food trade and using a science-based criteria embodied in Codex Alimentarius international standards. The approach links two streams of the NTM literature, one concerned with the aggregation of various NTMs into operational indices for econometric and modeling purposes, and the other attempting to evaluate the protectionism of NTMs. The data used in the application come from a large international dataset on veterinary and pesticide MRLs and CODEX MRL standards for a large set of countries KeywordsNTMs, non-tariff measures, barriers, protectionism, maximum residue limit, MRL

Protecting health or protecting imports? Evidence from EU non-tariff measures

“…Thus, we define protectionism as the fraction of a country's standards that are more stringent than the standards internationally recognized by the WTO. Following Li and Beghin (2014), using MRLs of pesticides standards, we formalize what protectionism is by developing an index of protectionism for standards, which we define as the differences in the stringency of a country's standards to internationally acceptable scientific standards. One may categorize standards that exceed the internationally accepted ones as being overly stringent, 'excessive standards', and protectionist in nature and therefore more trade distorting.…”

“…The protectionist usage of pesticide standards and their implication for exporting countries is not yet completely understood. This can be largely attributed to the difficulty of differentiating these standards' non-trade policy objectives from their trade policy objectives, and a lack of a globally accepted benchmark for doing this (Li and Beghin, 2014;Xiong and Beghin, 2014). This emanates from the fact that that any of them are contingent protection measures that are used in targeting specific sectors without violating the World Trade Organisation (WTO) principle of non-discrimination in trade (Miyagiwa, Song, and Vandenbussche, 2016).…”

“…Likewise, domestic standards that are lower than the international socially optimal benchmark can be said to be less trade distorting or perhaps trade enhancing, but also suboptimal and non-protectionist. However, empirical investigation of the trade effect of such suboptimal standards is rare due to the difficulty of distinguishing standards with legitimate intent from those with protectionist intent (Li and Beghin, 2014). Thus, this study fills this research gap by estimating the protectionism extent of EU pesticide standards relative to their globally acceptable benchmark and how this affects the potential of African food exporters to establish trade relations with the EU.…”

“…Thus, this study fills this research gap by estimating the protectionism extent of EU pesticide standards relative to their globally acceptable benchmark and how this affects the potential of African food exporters to establish trade relations with the EU. The most related study in this sense is that of Li and Beghin (2014), albeit still with significant differences. Firstly, the focus of their study was on the United States (US) rather than the EU.…”

Standards, Tariffs and Trade: The Rise and Fall of the Raisin Trade between Greece and France in the Late 19th Century and the Definition of Wine

“…Moreover, the policy instruments involved are often dissimilar and difficult to aggregate; data are scarce for effects of public regulations and almost inexistent for private standards (Baldwin, 2000;Marette, 2014). Li and Beghin (2014) conclude that sorting out the protectionism of standards is complex once one moves beyond simple detection strategies.…”