Market integration is key to ensuring sufficient and stable food supplies. This paper assesses the impediments to market integration in Central and Eastern Africa for three food staples: maize, rice, and sorghum. ... See More + The paper uses a large database on monthly consumer prices for 150 towns in 13 African countries and detailed data on the length and quality of roads linking the towns. The analysis finds a substantial effect of distance and share of paved road on the level of market integration, as measured by relative prices. Furthermore, the paper evaluates the additional domestic and cross-border impediments to market integration in the region and represents them on a regional map. The analysis finds heterogeneous levels of domestic market integration across countries and significant "border effects" for the majority of contiguous countries in the sample, which reveal that markets are more integrated within than between countries. Countries that are members of the same regional trade agreement have substantially "thinner" borders with other members. Finally, the analysis shows that countries with less integrated domestic markets and "thicker" borders with their neighbors also have a higher prevalence of food insufficiency. These findings support policy efforts in tackling domestic and border impediments to transactions such as reforming customs, simplifying nontariff measures, addressing corruption, improving the quality of roads, and deepening regional trade agreements. See Less -
Policy Research Working Paper WPS7003 AUG 01, 2014
Brenton, Paul; Portugal-Perez, Alberto; Regolo, Julie
Least developed countries rely on preferential market access. Proof of sufficient transformation has to be provided to customs in importing countries by meeting Rules of Origin requirements to benefit from these preferences. ... See More + These Rules of Origin have turned out to be complicated and burdensome for exporters in the least developed countries. Starting around 2001, under the United States Africa Growth Opportunity Act, 22 African countries exporting apparel to the United States can use fabric from any origin (single transformation) and still meet the criterion for preferential access (the so-called Special Rule), while the European Union continued to require yarn to be woven into fabric and then made into apparel in the same country (double transformation). This paper uses panel estimates over 1996-2004 to exploit this quasi-experimental change in the design of preferences. The paper estimates that this simplification contributed to an increase in export volume of about 168 percent for the top seven beneficiaries or approximately four times as much as the 44 percent growth effect from the initial preference access under the Africa Growth Opportunity Act without the single transformation. This change in design also mattered for diversity in apparel exports, as the number of export varieties grew more rapidly under the Africa Growth Opportunity Act special regime. See Less -
Policy Research Working Paper WPS6357 FEB 01, 2013
de Melo, Jaime; Portugal-Perez, Alberto
Using a new database on Chinese food standards, this paper estimates the impact of volunta-ry and mandatory standards on its agricultural and food exports. ... See More + The dataset covers seven Chinese products from 1992 to 2008. The findings here indicate that standards have a posi-tive effect on China's export performance. Standards signal to customers that products meet certain quality measures and promote information exchange. The benefits of increased ex-ports outweigh compliance costs. Our results also show that theses positive effects are larger when the standards are consistent with international norms. See Less -
Policy Research Working Paper WPS5976 FEB 01, 2012
Mangelsdorf, Axel; Portugal-Perez, Alberto; Wilson, John S.
This paper evaluates the impact of foreign aid to five service sectors (transportation, information and communications technologies, energy, banking/financial services, and business services) on exports of downstream manufacturing sectors in developing countries. ... See More + To address the reverse causality between aid and exports, the analysis relies on an original identification strategy that exploits (i) the variation of aid flows to service sectors, and (ii) the variation of service-intensities across industrial sectors and countries using input-output data. The authors find a positive effect of aid to services, in general, on downstream manufacturing exports of developing countries across regions and income-level groups. See Less -
Policy Research Working Paper WPS5728 JUL 01, 2011
Ferro, Esteban; Portugal-Perez, Alberto; Wilson, John S.
The authors estimate the impact of aggregate indicators of "soft" and "hard" infrastructure on the export performance of developing countries. ... See More + They build four new indicators for 101 countries over the period 2004-07. Estimates show that trade facilitation reforms do improve the export performance of developing countries. This is particularly true with investment in physical infrastructure and regulatory reform to improve the business environment. Moreover, the findings provide evidence that the marginal effect of infrastructure improvement on exports appears to be decreasing in per capita income. In contrast, the impact of information and communications technology on exports appears increasingly important for richer countries. Drawing on estimates, the authors compute illustrative exports growth for developing countries and ad-valorem equivalents of improving each indicator halfway to the level of the top performer in the region. As an example, improving the quality of physical infrastructure so that Egypt's indicator increases half-way to the level of Tunisia would increase exports by 10.8 percent. This is equivalent to a 7.4 percent cut in tariffs faced by Egyptian exporters across importing markets. See Less -
Policy Research Working Paper WPS5261 APR 01, 2010
Portugal-Perez, Alberto; Wilson, John S.
Product standards can have a dual impact on production and trade costs. Standards may impose additional costs on exporters as it may be necessary to adapt products for specific markets (cost-effect). ... See More + In contrast, standards can reduce exporters information costs if they convey information on industrial requirements or consumer tastes that would be costly to collect in the absence of standards (informational-effect). Using a new World Bank database of European standards for electronic products, the authors examine the impact of internationally-harmonized European standards on European Union imports. They find that European Union standards for electronic products that are harmonized to international standards have a positive and significant effect on trade. The results suggest that efforts to promote trade in electronic products could be complemented by steps to promote standards harmonization. This might include, for example, re-starting talks to extend the Information Technology Agreement to non-tariff measures and commitments to harmonize national standards in electronic products. See Less -
Policy Research Working Paper WPS4916 APR 01, 2009
Portugal-Perez, Alberto; Reyes, Jose-Daniel; Wilson, John S.
Rules of origin are legitimate policy instruments to prevent trade deflection in a preferential trade agreement short of a customs union. Trade deflection takes place when a product imported into the preferential trade agreement through the member with the lowest external tariff is transhipped to a higher-tariff member, while yielding a benefit for the re-exporter. ... See More + Yet, when captured by special interest groups, rules of origin can restrict trade beyond what is needed to prevent trade deflection. By how much do political economy factors account for the stringency of rules of origin? This study quantifies the impact of both determinants - those considered "justifiable" because they prevent trade deflection and those deemed to arise from "political economy" forces - on the restrictiveness of rules of origin under the North American Free Trade Agreement, approximated by a restrictiveness index. The main finding is that political economy forces, especially from the United States, raised significantly the restrictiveness of the rules of origin. Indeed, in industries where political-economy forces were strong prior to the North American Free Trade Agreement, as when the U.S. Most Favored Nation tariff was high or the revealed comparative advantage of Mexico (the United States) was strong (weak), more stringent rules of origin were introduced. Thus, stricter rules of origin are associated with higher production costs reducing the potential benefits of enhanced market access that is initially pursued by this type of agreement. See Less -
Policy Research Working Paper WPS4848 FEB 01, 2009
This paper reviews data and research on trade costs for Sub-Saharan African countries. It focuses on: border-related costs, transport costs, costs related to behind-the border issues, and the costs of compliance with rules of origin specific to preferential trade agreements. ... See More + Trade costs are, on average, higher for African countries than for other developing countries. Using gravity-model estimates, the authors compute ad-valorem equivalents of improvements in trade indicators for a sample of African countries. The evidence suggests that the gains for African exporters from improving the trade logistics half-way to the level in South Africa is more important than a substantive cut in tariff barriers. As an example, improving logistics in Ethiopia half-way to the level in South Africa would be roughly equivalent to a 7.5 percent cut in tariffs faced by Ethiopian exporters. See Less -
Policy Research Working Paper WPS4719 SEP 01, 2008
Portugal-Perez, Alberto; Wilson, John S.
The effective market access granted to textiles and apparel under the North American Free Trade Agreement (NAFTA) is estimated, taking into account the presence of rules of origin. ... See More + First, estimates are provided of the effect of tariff preferences combined with rules of origin on the border prices of Mexican final goods exported to the United States (U.S.) and of U.S. intermediate goods exported to Mexico, based on eight-digit harmonized system tariff-line data. A third of the estimated rise in the border price of Mexican apparel products is found to compensate for the cost of complying with NAFTA's rules of origin, and NAFTA is found to have raised the price of U.S. intermediate goods exported to Mexico by around 12 percent, with downstream rules of origin accounting for a third of that increase. Second, simulations are used to estimate welfare gains for Mexican exporters from preferential market access under NAFTA. The presence of rules of origin is found to approximately halve these gains. See Less -
Journal Article 77496 SEP 01, 2005
Cadot, Olivier; Carrere, Celine; de Melo, Jaime; Portugal-Perez, Alberto
|Title||Document Date||Report No.||Document Type||Also available in|
|Food prices, road infrastructure, and market integration in Central and Eastern Africa (English) See More +||AUG 01, 2014||WPS7003||Policy Research Working Paper|
|Preferential market access design: evidence and lessons from African apparel exports to the us and the EU (English) See More +||FEB 01, 2013||WPS6357||Policy Research Working Paper|
|Food standards and exports : evidence from China (English) See More +||FEB 01, 2012||WPS5976||Policy Research Working Paper|
|Aid to the services sector : does it affect manufacturing exports ? (English) See More +||JUL 01, 2011||WPS5728||Policy Research Working Paper|
|Export performance and trade facilitation reform : hard and soft infrastructure (English) See More +||APR 01, 2010||WPS5261||Policy Research Working Paper|
|Beyond the information technology agreement : harmonization of standards and trade in electronics (English) See More +||APR 01, 2009||WPS4916||Policy Research Working Paper|
|Assessing the impact of political economy factors on rules of origin under NAFTA (English) See More +||FEB 01, 2009||WPS4848||Policy Research Working Paper|
|Why trade facilitation matters to Africa ? (English) See More +||SEP 01, 2008||WPS4719||Policy Research Working Paper|
|Market access and welfare under free trade agreements : textiles under NAFTA (English) See More +||SEP 01, 2005||77496||Journal Article|