Technical Measures to Trade in Central America : Incidence, Price Effects, and Consumer Welfare

Despite the widespread tariff reductions sparked by the Dominican Republic-Central America Free Trade Agreement, borders in the region remain thick, with many hurdles standing in the way of regional trade. Although anecdotal evidence suggests that...

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Main Authors:	Kelleher, Sinead, Reyes, Jose-Daniel
Format:	Policy Research Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2014
Subjects:	AGRICULTURAL PRODUCTS AGRICULTURAL SECTOR AGRICULTURE ARABLE LAND AUTHORIZATION REQUIREMENT BARRIER BENCHMARK BENCHMARKS BORDER PRICE CAPITAL STOCK CARIBBEAN REGION CHANGES IN POVERTY COMMODITIES COMPETITIVE ADVANTAGE COMPETITIVENESS CONSUMER PRICES CONSUMER PROTECTION CONSUMERS CONSUMPTION BASKET COST OF LIVING COUNTRY DUMMY COUNTRY FIXED EFFECTS DATA AVAILABILITY DEMOCRACY DEVELOPING COUNTRIES DEVELOPMENT POLICY DISTRIBUTION OF INCOME DOMESTIC MARKET DOMESTIC PRICE DOMESTIC PRICES ECONOMIC EFFECT ECONOMIC EFFECTS ECONOMIC INTEGRATION ECONOMIC RESEARCH ECONOMIC SECTORS ECONOMICS RESEARCH EXPENDITURE EXPORT MARKET EXPORTS EXTERNALITY EXTREME POVERTY EXTREME POVERTY LINE FINANCIAL SUPPORT FOOD GOODS FOOD ITEMS FOOD PRODUCTS FREE TRADE FREE TRADE AGREEMENT FUTURE RESEARCH GDP GEOGRAPHIC REGIONS HARMONIZATION HOUSEHOLD INCOME HOUSEHOLD SURVEY IMPACT ON POVERTY INCOME INCOME DISTRIBUTION INFORMATION TECHNOLOGY INSURANCE INTELLECTUAL PROPERTY INTERNATIONAL MARKET INTERNATIONAL TRADE INTRA-REGIONAL TRADE INVENTORIES INVENTORY ITC LIVING ADJUSTMENT LOW-INCOME ECONOMIES MARKET ACCESS MARKET ENTRY MARKET FAILURE MARKET SHARE MARKET STRUCTURE MARKETING MEAT MIDDLE INCOME COUNTRIES NEGATIVE EXTERNALITY PLANT HEALTH POLITICAL ECONOMY POOR POOR HOUSEHOLDS POSITIVE EXTERNALITIES POVERTY ANALYSIS POVERTY IMPACT POVERTY LEVELS POVERTY LINE POVERTY LINES POVERTY POVERTY POVERTY RATE POVERTY RATES POVERTY REDUCTION PRICE CHANGE PRICE COMPARISONS PRICE CONTROLS PRICE EFFECT PRICE INCREASE PRICE INCREASES PRODUCT QUALITY PROTECTIONISM PUBLIC POLICIES PURCHASING REGIONAL AGENCIES REGIONAL COMPETITIVENESS REGIONAL COVERAGE REGIONAL INSTITUTIONS REGIONAL INTEGRATION REGIONAL LEVEL REGIONAL SECRETARIATS REGIONAL TRADE REGIONAL TRADING PARTNERS REGISTRATION REQUIREMENT REGISTRATION REQUIREMENTS REGULATORY BODIES REGULATORY ENVIRONMENT REGULATORY FRAMEWORK RURAL RURAL AREAS RURAL DEVELOPMENT SALES SMALL COUNTRY SUPPLIERS TARIFF BARRIERS TAX TRADE BARRIERS TRADE POLICIES TRADE POLICY TRADING SYSTEM TRANSACTION COSTS TRANSPARENCY VOTERS WAR WORLD DEVELOPMENT INDICATORS WORLD ECONOMY WORLD REGIONS WORLD TRADE WORLD TRADE ORGANIZATION WTO
Online Access:	http://documents.worldbank.org/curated/en/2014/05/19457741/technical-measures-trade-central-america-incidence-price-effects-consumer-welfare http://hdl.handle.net/10986/18359

id	okr-10986-18359
recordtype	oai_dc
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	AGRICULTURAL PRODUCTS AGRICULTURAL SECTOR AGRICULTURE ARABLE LAND AUTHORIZATION REQUIREMENT BARRIER BENCHMARK BENCHMARKS BORDER PRICE CAPITAL STOCK CARIBBEAN REGION CHANGES IN POVERTY COMMODITIES COMPETITIVE ADVANTAGE COMPETITIVENESS CONSUMER PRICES CONSUMER PROTECTION CONSUMERS CONSUMPTION BASKET COST OF LIVING COUNTRY DUMMY COUNTRY FIXED EFFECTS DATA AVAILABILITY DEMOCRACY DEVELOPING COUNTRIES DEVELOPMENT POLICY DISTRIBUTION OF INCOME DOMESTIC MARKET DOMESTIC PRICE DOMESTIC PRICES ECONOMIC EFFECT ECONOMIC EFFECTS ECONOMIC INTEGRATION ECONOMIC RESEARCH ECONOMIC SECTORS ECONOMICS RESEARCH EXPENDITURE EXPORT MARKET EXPORTS EXTERNALITY EXTREME POVERTY EXTREME POVERTY LINE FINANCIAL SUPPORT FOOD GOODS FOOD ITEMS FOOD PRODUCTS FREE TRADE FREE TRADE AGREEMENT FUTURE RESEARCH GDP GEOGRAPHIC REGIONS HARMONIZATION HOUSEHOLD INCOME HOUSEHOLD SURVEY IMPACT ON POVERTY INCOME INCOME DISTRIBUTION INFORMATION TECHNOLOGY INSURANCE INTELLECTUAL PROPERTY INTERNATIONAL MARKET INTERNATIONAL TRADE INTRA-REGIONAL TRADE INVENTORIES INVENTORY ITC LIVING ADJUSTMENT LOW-INCOME ECONOMIES MARKET ACCESS MARKET ENTRY MARKET FAILURE MARKET SHARE MARKET STRUCTURE MARKETING MEAT MIDDLE INCOME COUNTRIES NEGATIVE EXTERNALITY PLANT HEALTH POLITICAL ECONOMY POOR POOR HOUSEHOLDS POSITIVE EXTERNALITIES POVERTY ANALYSIS POVERTY IMPACT POVERTY LEVELS POVERTY LINE POVERTY LINES POVERTY POVERTY POVERTY RATE POVERTY RATES POVERTY REDUCTION PRICE CHANGE PRICE COMPARISONS PRICE CONTROLS PRICE EFFECT PRICE INCREASE PRICE INCREASES PRODUCT QUALITY PROTECTIONISM PUBLIC POLICIES PURCHASING REGIONAL AGENCIES REGIONAL COMPETITIVENESS REGIONAL COVERAGE REGIONAL INSTITUTIONS REGIONAL INTEGRATION REGIONAL LEVEL REGIONAL SECRETARIATS REGIONAL TRADE REGIONAL TRADING PARTNERS REGISTRATION REQUIREMENT REGISTRATION REQUIREMENTS REGULATORY BODIES REGULATORY ENVIRONMENT REGULATORY FRAMEWORK RURAL RURAL AREAS RURAL DEVELOPMENT SALES SMALL COUNTRY SUPPLIERS TARIFF BARRIERS TAX TRADE BARRIERS TRADE POLICIES TRADE POLICY TRADING SYSTEM TRANSACTION COSTS TRANSPARENCY VOTERS WAR WORLD DEVELOPMENT INDICATORS WORLD ECONOMY WORLD REGIONS WORLD TRADE WORLD TRADE ORGANIZATION WTO
spellingShingle	AGRICULTURAL PRODUCTS AGRICULTURAL SECTOR AGRICULTURE ARABLE LAND AUTHORIZATION REQUIREMENT BARRIER BENCHMARK BENCHMARKS BORDER PRICE CAPITAL STOCK CARIBBEAN REGION CHANGES IN POVERTY COMMODITIES COMPETITIVE ADVANTAGE COMPETITIVENESS CONSUMER PRICES CONSUMER PROTECTION CONSUMERS CONSUMPTION BASKET COST OF LIVING COUNTRY DUMMY COUNTRY FIXED EFFECTS DATA AVAILABILITY DEMOCRACY DEVELOPING COUNTRIES DEVELOPMENT POLICY DISTRIBUTION OF INCOME DOMESTIC MARKET DOMESTIC PRICE DOMESTIC PRICES ECONOMIC EFFECT ECONOMIC EFFECTS ECONOMIC INTEGRATION ECONOMIC RESEARCH ECONOMIC SECTORS ECONOMICS RESEARCH EXPENDITURE EXPORT MARKET EXPORTS EXTERNALITY EXTREME POVERTY EXTREME POVERTY LINE FINANCIAL SUPPORT FOOD GOODS FOOD ITEMS FOOD PRODUCTS FREE TRADE FREE TRADE AGREEMENT FUTURE RESEARCH GDP GEOGRAPHIC REGIONS HARMONIZATION HOUSEHOLD INCOME HOUSEHOLD SURVEY IMPACT ON POVERTY INCOME INCOME DISTRIBUTION INFORMATION TECHNOLOGY INSURANCE INTELLECTUAL PROPERTY INTERNATIONAL MARKET INTERNATIONAL TRADE INTRA-REGIONAL TRADE INVENTORIES INVENTORY ITC LIVING ADJUSTMENT LOW-INCOME ECONOMIES MARKET ACCESS MARKET ENTRY MARKET FAILURE MARKET SHARE MARKET STRUCTURE MARKETING MEAT MIDDLE INCOME COUNTRIES NEGATIVE EXTERNALITY PLANT HEALTH POLITICAL ECONOMY POOR POOR HOUSEHOLDS POSITIVE EXTERNALITIES POVERTY ANALYSIS POVERTY IMPACT POVERTY LEVELS POVERTY LINE POVERTY LINES POVERTY POVERTY POVERTY RATE POVERTY RATES POVERTY REDUCTION PRICE CHANGE PRICE COMPARISONS PRICE CONTROLS PRICE EFFECT PRICE INCREASE PRICE INCREASES PRODUCT QUALITY PROTECTIONISM PUBLIC POLICIES PURCHASING REGIONAL AGENCIES REGIONAL COMPETITIVENESS REGIONAL COVERAGE REGIONAL INSTITUTIONS REGIONAL INTEGRATION REGIONAL LEVEL REGIONAL SECRETARIATS REGIONAL TRADE REGIONAL TRADING PARTNERS REGISTRATION REQUIREMENT REGISTRATION REQUIREMENTS REGULATORY BODIES REGULATORY ENVIRONMENT REGULATORY FRAMEWORK RURAL RURAL AREAS RURAL DEVELOPMENT SALES SMALL COUNTRY SUPPLIERS TARIFF BARRIERS TAX TRADE BARRIERS TRADE POLICIES TRADE POLICY TRADING SYSTEM TRANSACTION COSTS TRANSPARENCY VOTERS WAR WORLD DEVELOPMENT INDICATORS WORLD ECONOMY WORLD REGIONS WORLD TRADE WORLD TRADE ORGANIZATION WTO Kelleher, Sinead Reyes, Jose-Daniel Technical Measures to Trade in Central America : Incidence, Price Effects, and Consumer Welfare
geographic_facet	Latin America & Caribbean Central America
relation	Policy Research Working Paper;No. 6857
description	Despite the widespread tariff reductions sparked by the Dominican Republic-Central America Free Trade Agreement, borders in the region remain thick, with many hurdles standing in the way of regional trade. Although anecdotal evidence suggests that nontariff measures raise trade costs and inhibit trade in the region, little is known about the magnitude of these economic effects. This paper uses a newly collected data set to quantify the incidence of sanitary and phytosanitary measures and technical barriers to trade in the region and benchmarks it with other parts of the world. The results indicate that the Central American region has the lowest prevalence of technical nontariff measures in the world. However, there is significant heterogeneity of trade-related regulations in Central America; for instance, 48 percent of Salvadoran imports are subject to at least one nontariff measure, compared with just 16 percent of Honduran imports. The paper estimates the impact of these technical measures on border prices and finds that the price impact of sanitary and phytosanitary measures is equivalent to an ad-valorem tariff of 11.6 percent. This price-rising effect is further investigated by looking in detail at the impact of sanitary and phytosanitary measures on the prices of beef, chicken meat, bread, and dairy products in Guatemala. The impact is estimated to be equivalent to an ad-valorem tariff of 68.4 percent, 51.4 percent, 22.0 percent, and 5.0 percent, respectively. The paper shows that efforts to streamline key sanitary and phytosanitary measures affecting these products by, for example, reducing the cost and time required to obtain sanitary registries, would likely reduce the Guatemalan urban extreme poverty rate from 5.07 percent to 4.91 percent.
format	Publications & Research :: Policy Research Working Paper
author	Kelleher, Sinead Reyes, Jose-Daniel
author_facet	Kelleher, Sinead Reyes, Jose-Daniel
author_sort	Kelleher, Sinead
title	Technical Measures to Trade in Central America : Incidence, Price Effects, and Consumer Welfare
title_short	Technical Measures to Trade in Central America : Incidence, Price Effects, and Consumer Welfare
title_full	Technical Measures to Trade in Central America : Incidence, Price Effects, and Consumer Welfare
title_fullStr	Technical Measures to Trade in Central America : Incidence, Price Effects, and Consumer Welfare
title_full_unstemmed	Technical Measures to Trade in Central America : Incidence, Price Effects, and Consumer Welfare
title_sort	technical measures to trade in central america : incidence, price effects, and consumer welfare
publisher	World Bank, Washington, DC
publishDate	2014
url	http://documents.worldbank.org/curated/en/2014/05/19457741/technical-measures-trade-central-america-incidence-price-effects-consumer-welfare http://hdl.handle.net/10986/18359
_version_	1764441556024033280
spelling	okr-10986-183592021-06-14T10:25:59Z Technical Measures to Trade in Central America : Incidence, Price Effects, and Consumer Welfare Kelleher, Sinead Reyes, Jose-Daniel AGRICULTURAL PRODUCTS AGRICULTURAL SECTOR AGRICULTURE ARABLE LAND AUTHORIZATION REQUIREMENT BARRIER BENCHMARK BENCHMARKS BORDER PRICE CAPITAL STOCK CARIBBEAN REGION CHANGES IN POVERTY COMMODITIES COMPETITIVE ADVANTAGE COMPETITIVENESS CONSUMER PRICES CONSUMER PROTECTION CONSUMERS CONSUMPTION BASKET COST OF LIVING COUNTRY DUMMY COUNTRY FIXED EFFECTS DATA AVAILABILITY DEMOCRACY DEVELOPING COUNTRIES DEVELOPMENT POLICY DISTRIBUTION OF INCOME DOMESTIC MARKET DOMESTIC PRICE DOMESTIC PRICES ECONOMIC EFFECT ECONOMIC EFFECTS ECONOMIC INTEGRATION ECONOMIC RESEARCH ECONOMIC SECTORS ECONOMICS RESEARCH EXPENDITURE EXPORT MARKET EXPORTS EXTERNALITY EXTREME POVERTY EXTREME POVERTY LINE FINANCIAL SUPPORT FOOD GOODS FOOD ITEMS FOOD PRODUCTS FREE TRADE FREE TRADE AGREEMENT FUTURE RESEARCH GDP GEOGRAPHIC REGIONS HARMONIZATION HOUSEHOLD INCOME HOUSEHOLD SURVEY IMPACT ON POVERTY INCOME INCOME DISTRIBUTION INFORMATION TECHNOLOGY INSURANCE INTELLECTUAL PROPERTY INTERNATIONAL MARKET INTERNATIONAL TRADE INTRA-REGIONAL TRADE INVENTORIES INVENTORY ITC LIVING ADJUSTMENT LOW-INCOME ECONOMIES MARKET ACCESS MARKET ENTRY MARKET FAILURE MARKET SHARE MARKET STRUCTURE MARKETING MEAT MIDDLE INCOME COUNTRIES NEGATIVE EXTERNALITY PLANT HEALTH POLITICAL ECONOMY POOR POOR HOUSEHOLDS POSITIVE EXTERNALITIES POVERTY ANALYSIS POVERTY IMPACT POVERTY LEVELS POVERTY LINE POVERTY LINES POVERTY POVERTY POVERTY RATE POVERTY RATES POVERTY REDUCTION PRICE CHANGE PRICE COMPARISONS PRICE CONTROLS PRICE EFFECT PRICE INCREASE PRICE INCREASES PRODUCT QUALITY PROTECTIONISM PUBLIC POLICIES PURCHASING REGIONAL AGENCIES REGIONAL COMPETITIVENESS REGIONAL COVERAGE REGIONAL INSTITUTIONS REGIONAL INTEGRATION REGIONAL LEVEL REGIONAL SECRETARIATS REGIONAL TRADE REGIONAL TRADING PARTNERS REGISTRATION REQUIREMENT REGISTRATION REQUIREMENTS REGULATORY BODIES REGULATORY ENVIRONMENT REGULATORY FRAMEWORK RURAL RURAL AREAS RURAL DEVELOPMENT SALES SMALL COUNTRY SUPPLIERS TARIFF BARRIERS TAX TRADE BARRIERS TRADE POLICIES TRADE POLICY TRADING SYSTEM TRANSACTION COSTS TRANSPARENCY VOTERS WAR WORLD DEVELOPMENT INDICATORS WORLD ECONOMY WORLD REGIONS WORLD TRADE WORLD TRADE ORGANIZATION WTO Despite the widespread tariff reductions sparked by the Dominican Republic-Central America Free Trade Agreement, borders in the region remain thick, with many hurdles standing in the way of regional trade. Although anecdotal evidence suggests that nontariff measures raise trade costs and inhibit trade in the region, little is known about the magnitude of these economic effects. This paper uses a newly collected data set to quantify the incidence of sanitary and phytosanitary measures and technical barriers to trade in the region and benchmarks it with other parts of the world. The results indicate that the Central American region has the lowest prevalence of technical nontariff measures in the world. However, there is significant heterogeneity of trade-related regulations in Central America; for instance, 48 percent of Salvadoran imports are subject to at least one nontariff measure, compared with just 16 percent of Honduran imports. The paper estimates the impact of these technical measures on border prices and finds that the price impact of sanitary and phytosanitary measures is equivalent to an ad-valorem tariff of 11.6 percent. This price-rising effect is further investigated by looking in detail at the impact of sanitary and phytosanitary measures on the prices of beef, chicken meat, bread, and dairy products in Guatemala. The impact is estimated to be equivalent to an ad-valorem tariff of 68.4 percent, 51.4 percent, 22.0 percent, and 5.0 percent, respectively. The paper shows that efforts to streamline key sanitary and phytosanitary measures affecting these products by, for example, reducing the cost and time required to obtain sanitary registries, would likely reduce the Guatemalan urban extreme poverty rate from 5.07 percent to 4.91 percent. 2014-05-15T19:02:22Z 2014-05-15T19:02:22Z 2014-05 http://documents.worldbank.org/curated/en/2014/05/19457741/technical-measures-trade-central-america-incidence-price-effects-consumer-welfare http://hdl.handle.net/10986/18359 English en_US Policy Research Working Paper;No. 6857 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Latin America & Caribbean Central America

Technical Measures to Trade in Central America : Incidence, Price Effects, and Consumer Welfare

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