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Export Competitiveness of Developing Countries and U.S. Trade Policy

Author

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  • Hakobyan, Shushanik
Abstract
We examine the impact of revocation of tariff exemptions on exports of developing countries, using data from the cases of Competitive Needs Limits (CNL) built into the Generalized System of Preferences (GSP). CNLs are arguably imposed on super competitive GSP beneficiaries and aim to limit their exporting capacity. We exploit the variation in the timing of the implementation of the CNLs across countries to identify the impact. We find that being excluded from the GSP due to a CNL induces a large and significant drop in imports from excluded countries, both in value and in their share in imports from all sources. Contrary to the policy objectives of CNLs, the excluded countries do not appear to be super competitive. In addition, we find some evidence of exporters increasing their exports of related products to the US after the CNL exclusion applies. Finally, our findings suggest that much of the benefits of CNLs accrue to non-GSP countries, rather than other GSP beneficiaries.

Suggested Citation

  • Hakobyan, Shushanik, 2011. "Export Competitiveness of Developing Countries and U.S. Trade Policy," Proceedings of the German Development Economics Conference, Berlin 2011 37, Verein für Socialpolitik, Research Committee Development Economics.
    • Handle: RePEc:zbw:gdec11:37
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    References listed on IDEAS

    as
    1. Jean‐Christophe Bureau & Raja Chakir & Jacques Gallezot, 2007. "The Utilisation of Trade Preferences for Developing Countries in the Agri‐food Sector," Journal of Agricultural Economics, Wiley Blackwell, vol. 58(2), pages 175-198, June.
    2. Craig R. Macphee & Victor Iwuagwu Oguledo, 1994. "Losses of tariff preferences and the export performance of less‐developed countries," Journal of International Development, John Wiley & Sons, Ltd., vol. 6(4), pages 361-371, July.
    3. James E. Anderson, 2011. "The Gravity Model," Annual Review of Economics, Annual Reviews, vol. 3(1), pages 133-160, September.
    4. James Devault, 1996. "Competitive Need Limits And The U.S. Generalized System Of Preference," Contemporary Economic Policy, Western Economic Association International, vol. 14(4), pages 58-66, October.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Generalized System of Preferences (GSP); Competitive Needs Limits; export competitiveness; trade policy; developing countries;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

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