Standards,trade margins and product quality: Firm-level evidence from Peru |
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Affiliation: | 1. PSE, Université Paris 1, Centre d’Economie de la Sorbonne, 106-112 Bd de l’Hôpital F-75647 Cedex 13, Paris, France;2. CEPII, 113 rue de Grenelle, 75007 Paris, France |
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Abstract: | The ongoing debate on whether agri-food (public) regulatory standards are barriers or catalysts to trade is particularly pertinent for developing countries who are often standard-takers. Current evidence on the trade effects of regulatory standards is ambiguous. In this paper, we give a contribution focusing on the firm heterogeneity trade effects of (different) types of agri-food standards, considering firm-level exports from Peru. Particular emphasis is given to standards with different degree of restrictiveness, such as specific trade concerns (STCs) raised on the most stringent NTMs, and to product-quality upgrading. Results show that only the most restrictive NTMs significantly limit agri-food exports for Peruvian firms, affecting the probability to trade, firms’ exit and the export volume. Regular SPSs are found to enhance trade. Importantly, we uncovered relevant heterogonous effects of NTMs on firms of different size, showing that only the most stringent standards result in product quality upgrading. |
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Keywords: | NTMs Firm-level data Trade margins Product quality F12 F14 Q18 |
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