Title

Tariff Equivalent of Technical Barriers to Trade with Imperfect Substitution and Trade Costs

Campus Units

Economics, Center for Agricultural and Rural Development

Document Type

Article

Publication Version

Submitted Manuscript

Publication Date

11-2006

Journal or Book Title

American Journal of Agricultural Economics

Volume

88

Issue

4

First Page or Article ID Number

947

Last Page

960

DOI

10.1111/j.1467-8276.2006.00908.x

Abstract

The price-wedge method yields a tariff-equivalent estimate of technical barriers to trade (TBT). An extension of this method accounts for imperfect substitution between domestic and imported goods and incorporates recent findings on trade costs. We explore the sensitivity of this revamped TBT estimate to its key determinants (substitution elasticity, preference for home good, and trade cost). We use the augmented approach to investigate the recent Japan–U.S. apple trade dispute and find that removing the Japanese TBT would yield limited export gains to the United States. We then draw policy implications of our findings.

JEL Classification

F13, F14, Q17

Comments

This is a working paper of an article from American Journal of Agricultural Economics 88 (2006): 947, doi: 10.1111/j.1467-8276.2006.00908.x.