Impact of Free Trade Agreement Use on Import Prices

We examine the impact of free trade agreement (FTA) use on import prices. For this analysis, we employ establishment-level import data with information on tariff schemes, that is, the FTA and most-favored-nation schemes used for importing. Unlike previous studies, we estimate the effects of FTA use...

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Bibliographic Details
Main Authors:	Hayakawa, Kazunobu, Laksanapanyakul, Nuttawut, Mukunoki, Hiroshi, Urata, Shujiro
Format:	Journal Article
Published:	Published by Oxford University Press on behalf of the World Bank 2021
Subjects:	FREE TRADE AGREEMENT WORLD TRADE ORGANIZATION FTA WTO TRADE LIBERALIZATION IMPORT PRICE TARIFFS
Online Access:	http://hdl.handle.net/10986/35418

id	okr-10986-35418
recordtype	oai_dc
spelling	okr-10986-354182021-04-23T14:02:21Z Impact of Free Trade Agreement Use on Import Prices Hayakawa, Kazunobu Laksanapanyakul, Nuttawut Mukunoki, Hiroshi Urata, Shujiro FREE TRADE AGREEMENT WORLD TRADE ORGANIZATION FTA WTO TRADE LIBERALIZATION IMPORT PRICE TARIFFS We examine the impact of free trade agreement (FTA) use on import prices. For this analysis, we employ establishment-level import data with information on tariff schemes, that is, the FTA and most-favored-nation schemes used for importing. Unlike previous studies, we estimate the effects of FTA use on prices by controlling for differences in importing-firm characteristics. There are three main findings. First, the effect of FTA use is overestimated when not controlling for importing firm-related fixed effects. Second, on average, firms’ FTA use reduces tariffs by 12 percentage points and raises import prices by 3.6–6.7 percent. Third, in general, we do not find a price rise resulting from the costs of complying with rules of origin. 2021-04-09T18:12:28Z 2021-04-09T18:12:28Z 2019-10 Journal Article World Bank Economic Review 1564-698X http://hdl.handle.net/10986/35418 CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Published by Oxford University Press on behalf of the World Bank Publications & Research Publications & Research :: Journal Article East Asia and Pacific Thailand
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
topic	FREE TRADE AGREEMENT WORLD TRADE ORGANIZATION FTA WTO TRADE LIBERALIZATION IMPORT PRICE TARIFFS
spellingShingle	FREE TRADE AGREEMENT WORLD TRADE ORGANIZATION FTA WTO TRADE LIBERALIZATION IMPORT PRICE TARIFFS Hayakawa, Kazunobu Laksanapanyakul, Nuttawut Mukunoki, Hiroshi Urata, Shujiro Impact of Free Trade Agreement Use on Import Prices
geographic_facet	East Asia and Pacific Thailand
description	We examine the impact of free trade agreement (FTA) use on import prices. For this analysis, we employ establishment-level import data with information on tariff schemes, that is, the FTA and most-favored-nation schemes used for importing. Unlike previous studies, we estimate the effects of FTA use on prices by controlling for differences in importing-firm characteristics. There are three main findings. First, the effect of FTA use is overestimated when not controlling for importing firm-related fixed effects. Second, on average, firms’ FTA use reduces tariffs by 12 percentage points and raises import prices by 3.6–6.7 percent. Third, in general, we do not find a price rise resulting from the costs of complying with rules of origin.
format	Journal Article
author	Hayakawa, Kazunobu Laksanapanyakul, Nuttawut Mukunoki, Hiroshi Urata, Shujiro
author_facet	Hayakawa, Kazunobu Laksanapanyakul, Nuttawut Mukunoki, Hiroshi Urata, Shujiro
author_sort	Hayakawa, Kazunobu
title	Impact of Free Trade Agreement Use on Import Prices
title_short	Impact of Free Trade Agreement Use on Import Prices
title_full	Impact of Free Trade Agreement Use on Import Prices
title_fullStr	Impact of Free Trade Agreement Use on Import Prices
title_full_unstemmed	Impact of Free Trade Agreement Use on Import Prices
title_sort	impact of free trade agreement use on import prices
publisher	Published by Oxford University Press on behalf of the World Bank
publishDate	2021
url	http://hdl.handle.net/10986/35418
_version_	1764482991522840576

Impact of Free Trade Agreement Use on Import Prices

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