WORLD TRADE  
ORGANIZATION  TN/MA/S/1/Rev.1 
21 December 2004 
 
 (04-5610) 
Negotiating Group on Market Access  
 
  
ANNOTATED SELECTIVE BIBLIOGRAPHY OF RESEARCH ON MARKET ACCESS 
 
Note by the Secretariat
 
 
Revision  
 
 
 
 
  
 
 
 The attached annotated bibliography of research in market access updates and complements 
the previous documents in the series TN/MA/S/1 by: 
 
• including studies on the various topics within the mandate of the Negotiating Group on 
Market Access which became available after September 2002, and  
• extending its coverage to recent stud ies of non-preferential market access. 
• providing links to the documents in electronic format when possible
1 
 
The studies are listed under the four following headings: 
 
I. GENERAL........................................................................................................................ .........2  
II. STUDIES ON SPECIFIC REGIONS OR COUNTRIES....................................................11  
III. NON-RECIPROCAL PREFERENCES ...............................................................................19  
IV. NON TARIFF MEASURES...................................................................................................28  
 
_______________ 
 
 
 
 
 
 
                                                      
1 All documents whose title is underlined can be accessed online from inside the Centre William 
Rappard by holding the CTRL key while clicking on the underlined text. Based on this bibliography, the WTO 
Library has also created within the Library database an online NAMA bibliography that will be updated on a 
regular basis. The online NAMA bibliography is already accessible from inside the WTO building. By 
January 2005, the database and the bibliography will be accessible from outside the building through an address to be announced. Note that online document access from outside the building will be restricted to those that are 
freely available on the Internet without subscription.  
 This document has been prepared under the Secretariat's own 
responsibility and without prejudice to the positions of Members 
and to their rights and obligations under the WTO TN/MA/S/1/Rev.1 
Page 2  
 
I. GENERAL  
Anderson, J.E., and J.P. Neary (2004) Welfare vs. Market Access: The Implications of Tariff 
Structure for Tariff Reform.  NBER Working Paper No. 10730, Cambridge, MA: NBER.  
 This paper shows that the effects of tariff chan ges on welfare and import volume can be fully 
characterized by their effects on the generalized mean and variance of the tariff distribution.  Using 
this result, the authors consider welfare- and ma rket-access-improving tariff changes, which imply 
two "cones of liberalization" in price space.  Because welfare is negatively but import volume 
positively related to the generalized variance, the c ones do not intersect, which poses a dilemma for 
trade policy reform.  Finally, they show that ge neralized and trade-weighted moments are mutually 
proportional when the trade ex penditure function is CES. 
 Anderson, K. (2003) Measuring Effects of Trade Policy Distortions: How Far Have We Come
? 
CEPR working paper No. 3597, London : CEPR. 
 
After a brief review of the literatu re to the early 1970s, this pape r assesses the co ntributions by 
economists during the past three decades to measuri ng the distortionary effects of trade policies.  It 
does not pretend to be a comprehensive survey, but dr aws on selections from the literature that give a 
sense of the distance the profession has travelle d from a trade policy practitioner's viewpoint since 
Corden's first paper on the subject in 1957.  Phenomenal though that progress has been, there is ample 
room for further improvement in computing the economic (and other) effects of trade-related policies and their reform.  The paper concludes with suggestions of where the priorities should be in global modelling of trade policy reform, as the world mo ves into the next round of multilateral trade 
negotiations.  Anderson, K. (2004) The Challenge of Reducing Subsidies and Trade Barriers
, CEPR 
Discussion Paper no 4592, London: CEPR. 
 
This is one of ten studies for the Copenhagen Consensus Project that sought to evaluate the most feasible opportunities to improve welfare globally and alleviate poverty in developing countries.  It 
argues that phasing out distortionary government su bsidies and barriers to international trade will 
yield an extraordinarily high benefit/cost ratio.  A survey is provided of recent estimates, using global economy wide simulation models, of the benefits of doing that via the current Doha round of multilateral trade negotiations.  Even if adjustment costs are several times as large as suggested by 
available estimates, the benefit-cost ratio from seiz ing this opportunity exceeds 20.  That is much 
higher than the rewards from regional or bilateral trade agreements or from providing preferential 
access for least-developed countries' exports to high-income countries.  Such reform would 
simultaneously contribute to alleviating several of the other key challenges reflected in the United 
Nations' Millennium Development Goals.  Banerjee, A. and A. Newman (2003) Inequality, Growth and Trade Policy
. Mimeo. Cambridge, 
MA: MIT. 
 
In this paper, a simple model of international trade that takes factor market imperfections seriously is 
built and used to analyse the impact of trade liberalization.  This model is a variant of the standard 
Ricardo-Viner model and clearly resists classifica tion along the "for or against Globalization" 
dimension, at least under their most naive interpreta tions.  What it does say, rather emphatically, is 
that from the point of view of poor countries liberal trade policies offer a rather harsh trade-off:  In the 
long run, growth may indeed benefit from liberalizing trade but at the cost of much short-run 
displacement.   TN/MA/S/1/Rev.1 
 Page 3 
 
 
Cernat, L., S. Laird and A. Turrini (2003) Back to Basics: Market Access Issues in the Doha 
Agenda. Division of International Trade in Goods and Services, and Commodities . Geneva: 
UNCTAD. 
 The aim of this paper is that of going "back to basics", focusing on issues of market access in 
merchandise trade that developing countries will face in the next negotiations.  Data on patterns of 
trade and protection in agriculture and manufacturing are analysed, the main results of the Doha WTO 
ministerial meeting are reviewed, and the likely impact of several liberalisation scenarios are 
evaluated.  The broad conclusion of the analysis is that for developing countries as a whole, the 
potential gains from improved market access in merchandise trade could be sizable, but the size and the distribution of these gains depend much on the extent to which developing countries will be active 
in the liberalization proces s and on the agreed negotiation targets and modalities. 
 Cline, W.R. (2004) Trade Policy and Global  Poverty, Washington, DC: Institute for 
International Economics. 
 
This book provides a comprehensive analysis of th e potential for trade liberalization to spur growth 
and reduce poverty in developing countries.  It quant ifies the impact on global poverty of industrial-
country liberalization, as well as liber alization by the developing countries. 
 
Half or more of the annual gains from trade wo uld come from the removal of industrial-country 
protection against developing-country exports.  By removing their trade barriers, industrial countries could convey economic benefits to developing coun tries worth about twice the amount of their annual 
development assistance.  By helping developing countries grow through trade, moreover, industrial 
countries could lower costs to consumers for imports and realize other economic efficiencies. The 
study estimates that free trade could reduce the number of people earning less than $2 per day by 
about 500 million over 15 years.  This would cut the world poverty level by 25 per cent. Cline judges 
that the developing countries were right to risk collapse of the Doha Round at the Cancún ministerial 
meeting in September 2003 by insisting on much deeper liberalization of agriculture than the 
industrial countries were then willing to offer.  The study calls for a two-track strategy:  first, deep 
multilateral liberalization involving phased but complete elimination of industrial-county protection 
and deep reduction of protection by at least the mi ddle-income developing countries, albeit on a more 
gradual schedule; and second, imme diate free entry for imports from "high risk" low-income countries 
(heavily indebted poor countries, least developed countries, and sub-Saharan Africa), coupled with a 
10-year tax holiday for direct investment in these countries. 
 
Cordoba, F.S., S. Laird and D. Vanzetti (2004) Trick or Treat? Development Opportunities and 
Challenges in the WTO Negoti ations on Industrial Tariffs . CREDIT Research Paper No. 04/03, 
Nottingham, UK : CREDIT.. 
 
Negotiations on industrial tariffs in the current WTO have turned out to be surprisingly more difficult 
that expected. On the one hand, developing countries , particularly in Africa, are concerned about the 
effect on their industrial development of developed country efforts to push them into deep cuts in 
applied tariffs:  after the dis illusion of the Uruguay Round, prom ises of welfare gains seem like 
buying one of Akerloff's lemon.  On the other hand, a number of the more complex formula proposals 
for tariff-cutting make it difficult to evaluate th e mercantilist equation:  how does what one has to do 
measure up against what one might expect from others?  The negotiations present an important 
opportunity to address the bias in protection agai nst developing countries' exports.  The developing 
countries are promised greater exports and welfare gains from the more ambitious proposals, but computations show that these also imply greater im ports, lower tariff revenues, some labour market 
adjustments and reduced output, threatening key sectors in some developing regions.  Preference 
losses, while moderate in the aggregate, seem quite significant in some cases.  Some way of assisting 
the developing countries in coping with these ad justments would make the negotiations seem a little TN/MA/S/1/Rev.1 
Page 4  
 
less like "Trick or Treat?" although proposals for bank-Fund "facilities" to already indebted countries 
to meet new WTO obligations may not be the highest development priority.   
 
Edmonds, E. and N. Pavcnik (2004) The Effects of Trade Liberalization on Child Labor. 
Journal of International Economics, forthcoming.  
 
The question of how trade liberalization affects the employment of children in developing economies 
is at the core of the debate on globalization.  This  paper examines the relationship between changes in 
the relative price of an exported commodity and chil d labour.  In particular, the authors relate child 
labour to regional and intertemporal variation in  the real price of rice surrounding national and 
international rice market integration in Vietnam.  They find that higher rice prices are associated with declines in child labour. Income effects play an important role in this relationship.  Rice price 
increases are associated with the largest declines in child labour in households that are large net 
producers of rice.  These findings show that greate r market integration can be associated with less 
child labour. Moreover, their results suggest that the use of punitive trade sanctions on exports from 
developing countries to eradicate child labour  is unlikely to yield the desired outcome. 
 
Erdem, E. and J. Tybout (2003) Trade Policy and Industrial Sector Responses: Using 
Evolutionary Models to Interpret the Evidence.  NBER working paper No.  9947, Cambridge, 
MA: NBER. 
 
Firm- and plant-level empirical studies typically fi nd that trade liberalization squeezes price-cost 
margins among import-competing firms, that this heightened competitive pressure induces 
productivity gains among these same firms, and that further efficiency gains come from market share 
reallocations.  Using a computable industrial e volution model to simulate the dynamic effects of 
import competition, the authors explore what types of managerial behaviour, long-term transition 
paths and welfare effects are consistent with this set of stylized facts. 
 
Fernandez de Cordoba, S., S. Laird and D. Vanzetti (2004) Blend it Like Beckham – Trying to 
Read the Ball in the WTO Negotiations on Industrial Tariffs , Credit Research Paper No. 04/04, 
Nottingham, UK: CREDIT.  
The current WTO negotiations on industrial tariffs have focused largely on a formula approach to 
cutting tariffs, but the process of trying to find a co mpromise that would satisfy all sides has led to a 
number of propositions that entail blending various elements of formulae, sectoral elimination, 
exceptions for sensitive products, capping to reduce tariff peaks, provisions for developing and least developed countries, provisions for recently acceded countries, and extending binding coverage at 
rates that could be determined in different ways.  Th is blend of approaches is very complex.  Yet for 
many countries, the outcome will determine for them  whether the Doha Ministerial Declaration of the 
WTO delivers on its development promises.  This pa per looks at the various proposals and tries to 
assess how they measure up against the objectives of the negotiations. 
 
Francois, J. and W. Martin (2003) Formula Approaches for Market Access Negotiations
. CEPR 
Discussion Paper No. 3720, London: CEPR. 
 
This paper surveys a range of formula options and examines both targeted and flexible applications of 
the Swiss formula that target tariff escalation and peaks, and would allow policymakers to directly 
target how far they will move towards free trade,  while providing some flexibility for trading off 
reductions in peak tariffs against reductions in lowe r-tariff sectors.  The key features of the market 
access landscape that will affect the choice of approa ches to negotiations include large dispersion of 
average tariffs amongst the active participants in the negotiations, and the large gaps between applied 
and bound tariff rates in many countries and sectors.  The Swiss formula approach used in the Tokyo 
Round is seen as particularly desirable.  Unfortunate ly, it appears likely to be too restrictive to apply it 
with the same coefficient used in the Tokyo Round .  To overcome this restrictiveness, this paper  TN/MA/S/1/Rev.1 
 Page 5 
 
 
present two new options for consideration, a targ eted and a flexible Swiss formula approach.  
Essentially, this increase in flex ibility would allow larger cuts in sm aller tariff rates to be used to 
compensate for smaller reductions in higher tariffs.  Applying this family of formulas suggests that 
only a bold cut, such as the 50 per cent target used in the Kennedy Round, would make substantial 
progress in increasing market access in both de veloping and developed countries. In industrial 
products, they find that a 50 per cent cut in average tariff bindings would bring about substantial 
reductions in average applied rates in each countr y, while particularly re ducing peak tariffs and 
escalation.  In agricultural products, binding overhang is greater in many countries than it is for 
industrial products. 
 
Francois, J., H. van Meijl and F. van Tongeren (2003) Trade Liberalization and Developing 
Countries Under the Doha Round , CEPR Discussion Paper No. 4032, London: CEPR.  
 
This paper explores the impact of multilateral liber alization, with emphasis on distributional effects 
across countries.  The authors first develop a realistic 'baseline' that takes into account events such as 
the entry of China into the WTO and the enlargement of the EU, allowing us to focus on those effects that are specifically attributable to further trade li beralization in the Doha Roun d.  They then employ a 
global applied general equilibrium model, featuri ng capital accumulation and imperfect competition.  
Their Doha scenarios include agriculture, manufa ctures, and services liberalization, and trade 
facilitation.  With agglomeration, OECD agricult ural liberalization is not uniformly positive for 
developing countries. 
 
Francois, J. and W. Martin (2004) Commercial Policy Variability, Bindings, and Market 
Access . CEPR Discussion Paper No. 3294, London: CEPR. 
 This paper argues that protection rates can vary in response to a wide range of pressures for 
protection, and that these pressures are likely to cont inue to generate varying rates of protection even 
after the introduction of new tariff bindings.  Accord ingly, the authors characterize trade policy in the 
presence of a tariff binding as generating uncertain rates of protection subject to the limit imposed by 
the binding.  The authors further show that improv ed market access, in terms of reduced terms of 
trade uncertainty related to export market protection, has welfare implications that follow not only 
from the expected level of market  access, but also from the stability of the conditions of access. 
 
Geithner, T. and G. Nankani (2002) Market Access for Developing Countries Exports – Selected 
Issues . Paper prepared by the Staffs of the IMF and the World Bank, Washington, DC: World 
Bank and IMF.  
 
This paper reviews the patterns of protection  and considers policies that would support a 
development-oriented liberalization of the multilate ral trading system.  Wh ile other papers have 
underscored the importance of trade policy reforms in developing countries, this paper focuses 
primarily on industrial country polic ies.  Regarding the broad patterns  of protection, it is suggested 
that priority should be given to phasing out tariff peaks and escalation, to tighter disciplines on trade 
remedy laws, and to the needs of developing countri es in meeting proliferating product standards and 
regulations. It also endorses the extension of comprehensive duty- and quota-free access for exports 
from LDCs to all industrial country markets.  Th e efficiency gains from liberalization of trade in 
textiles and clothing products would li kely be significant for developing  and industrial countries alike.  
At the same time though, the removal of quota restrictions, already agreed under the Uruguay Round 
and set to be completed by 2005, may cause shifts in  competitiveness, and, at least in the near term, 
affect the balance of payments positions of those exporters whose market access is effectively protected by the current system. 
 TN/MA/S/1/Rev.1 
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Ghosh, M., C. Perroni and J. Whalley (2003) Developing-Country Benefits from MFN Relative 
to Regional/Bilateral Trade Arrangements , Review of International Economics, vol. 11(4), pp. 
712-728. 
 Using a general-equilibrium model of world trade, this paper evaluates the benefits of most-favoured-
nation (MFN) treatment to developing countries in multilateral relative to bilateral or regional trade 
agreements, from three sources.  First, developing count ries may be able to free-ride on bilateral tariff 
concessions exchanged between larger countries in MFN-based GATT/WTO rounds. Second, MFN 
benefits developing countries by restricting discri minatory retaliatory actions by other countries, 
evaluated here by a non-cooperative Nash tariff  game.  Finally, MFN changes threat points in 
bargaining and hence affects the bargaining so lution of multilateral MFN-based trade negotiation 
compared to a bilateral/regional arrangement.  Th e authors find that the benefits to developing 
countries are small in the first case as the tariff rates are already low, and the benefits are small in the 
second case as the optimal tariffs under unconstraine d retaliation are not very asymmetric.  Benefits 
from the third case are large as large countries can extract large side-payments if they bargain 
bilaterally.  
Goldberg, P. and N. Pavcnik (2003) The Response of the Informal Sector to Trade 
Liberalization . NBER Working Paper No. 9443, Cambridge, MA: NBER. 
 
This paper studies the relationship between trade libe ralization and informality.  It is often claimed 
that increased foreign competition in developing co untries leads to an expansion of the informal 
sector, defined as the sector that does not comply with  labour market legislation.  Using data from two 
countries that experienced large trade barrier reductions in the 1980's and 1990's Brazil and Colombia, 
we examine the response of the informal sector to liberalization.  In Brazil, we find no evidence of 
such a relationship, but only for the period precedin g a major labour market reform that increased the 
flexibility of the Colombian labour market.  These re sults point to the significance of labour market 
institutions in assessing the effects of trade policy on the labour market.  Goldberg, P.K. and N. Pavcnik (2004) Trade, Inequality, and Poverty: What Do We Know? 
Evidence from Recent Trade Liberalization Episodes in Developing Countries , NBER Working 
Paper No. 10593, Cambridge, MA: NBER. 
 
This paper reviews the empirical evidence on the re lationship between trade liberalization, inequality, 
and poverty based on the analysis of micro data fr om several developing countries that underwent 
significant trade reforms in recent years.  Despite  many measurement and identification difficulties, 
and despite conflicting evidence on some issues, empirical work based on "country case studies" has 
established certain patterns that seem common across countries and trade liberalization episodes, and 
may hence be informative as to how developing countries adjust to trade reform.  Guha-Khasnobis, B. (2004) Who Gains From Tariff Escalation
? Journal of Economic 
Integration, vol. 19(2), pp. 416-425.  
With the help of a simple model of production and trade, this paper examines the differential impact 
of tariff escalation on skilled and unskilled wages in an economy.  The findings provide a lobbying-
based explanation of the prevalence of tariff escalation in developed countries.  It also predicts the 
possible response of the developing country and shows how similar lobbying activity in that country 
can slow the pace of liberalization of service sector trade.  The conclusion is that skilled labour and capital owner are likely to gain from it.  It seems reasonable to imagine that these two groups in any 
country have greater lobbying power, relative to unskilled labour.  Therefore, one of the reasons why 
governments of developed countries may feel compe lled to preserve such differential rates of 
protection between stages of production, is lobbying by skilled labour and capital owners.  If skilled 
labour groups are equally influential in developing countries, the model predicts that liberalization of 
the service sectors in these countries may be slow and difficult.   TN/MA/S/1/Rev.1 
 Page 7 
 
 
 Hoekman, B. (2004) Developing Countries a nd the WTO Doha Round: Market Access, Rules 
and Differential Treatment, Journal of Ec onomic Integration, vol. 19(2), pp. 205-230. 
 This paper discusses the challenges confron ting developing countries seeking to use WTO 
negotiations to promote their economic growth a nd performance.  Progress will require that major 
stakeholders within countries perceive the overall package to be beneficial.  A number of possible 
focal points that could be used as benchmarks fo r negotiations are discussed, as is the issue of 
differential and more than favourable treatment for developing countries.  A precondition for a good 
development outcome is a significant reduction in ba rriers to trade in goods and services.  This will 
have a much greater beneficial impact than effort s at multilateral rule-making in regulatory areas.  A 
new approach towards special and differential treat ment that involves greater differentiation between 
Members and is based on country-specific economic analysis and criteria would help to enhance the 
development-relevance of the WTO.  
 
International Monetary Fund (2002) Improving Market Access: Toward Greater Coherence 
Between Aid and Trade. Issues Brief , Washington, DC: IMF. 
 Integration into global markets of fers the potential for more rapi d economic growth, the creation of 
better-paid jobs, and poverty reduction.  However,  many of the poorer developing countries have 
found it difficult to take full advant age of the opportunities of the glob al market.  Supply response has 
been weak for a variety of structural reasons, in cluding weak institutional capacity, but also because 
policies are often not supportive. Industrial countries have maintained market access barriers and 
agricultural policies that penalize typical develo ping country products.  A coherent approach to 
development and trade calls for trade policies that create market opportunities for developing 
countries, and for development policies that enable  them to respond to these opportunities.  The key 
components of such an approach are:  (i) Early,  generous and predictable market access for the 
exports of developing countries, especially th e poorest, within a framework of multilateral 
liberalization and combined with strong multilateral ru les.  (ii) Determined action to reform industrial 
country agricultural regimes, eliminating trade distortions that harm developing countries.  
(iii) Capacity-building assistance that improves the ability of developing count ries to take advantage 
of new opportunities for trade.  (iv) Sound and cohere nt trade and trade-related policies in developing 
countries themselves, which should be reflected within development plans and strategies for poverty 
reduction.  Kanji, N. and S. Barrientos (2002) Trade liberalization, Poverty and Livelihoods: 
Understanding the Linkages,  IDS Working Paper, 159, Brighton: IDS. 
 The main purpose of this paper is to review key analytical approaches that are used to understand the linkages between trade, poverty and livelihoods, with a view to better understanding their linkages in 
the context of SSA.  The authors explore two main  perspectives: mainstream economics takes an 
aggregate approach, measur es poverty primarily on the basis of  income, and is generally positive 
about the impacts of trade liberalisation on povert y.  A wider socio-economic, livelihoods perspective 
focuses on micro-level complexity, employs mul ti-dimensional concepts of poverty and is less 
positive about the impact of trade liberalisation on poverty.  A broad approach is of particular 
importance for SSA.  From an analytical perspective, they examine three separate approaches: value 
chain, gender and sustainable development perspectives .  Each of these has been developed within its 
own sphere of interest, but each provides insights into the more co mplex interaction between trade 
and poverty at a macro, meso and micro level.  
 TN/MA/S/1/Rev.1 
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Kletzer, L. (2004) Trade-related Job Loss and Wage Insurance: A synthetic Review.
 Review of 
International Economics, vol. 12(5), pp. 724-748.  
 
This paper seeks to promote further integration of empirical and theoretical discussions of trade and 
worker adjustment.  Kletzer develops a set of styli zed facts of trade-related job loss, with a focus on 
worker characteristics and labour market consequences.  These stylized facts are relevant to any 
(credible) model of trade liberalization and adjustme nt costs.  The author then discusses the basic 
ideas of wage insurance and summarize the little th at is known about how a program might work if 
implemented in the US.  A final section provides a list of issues for a model of trade that will be 
consistent with the empirical stylized facts, sets  out questions for future research and concludes. 
 
Krueger, A. and A. Berg (2002) Trade, Growth and Poverty – A Selective Survey , Annual  Bank 
Conference on Development Economics, Washington, DC: World Bank. 
 This survey examines, through recent literature, the importance of trade policy for poverty reduction.  The authors consider the effects of openness on pove rty in two components:  the effect of openness on 
average income growth, and the effect on distri bution for a given growth rate.  Evidence from a 
variety of sources supports the view that trade openness contributes greatly to growth.  Moreover, 
trade openness does not have systematic effects on the poor beyond its effect on overall growth.  
Trade policy is only one of many determinants of growth and poverty reduction.  Trade openness has 
important positive spillovers on other aspects of reform , however, so that the correlation of trade with 
other pro-reform policies speaks to the advantages of making openne ss a primary part of the reform 
package. 
 
Laird, S., S. Fernandez de Cord oba, and D. Vanzetti (2003) Market Access Proposals for Non-
Agricultural Products . CREDIT Research Paper No. 03/08, Nottingham, UK: ESRC CREDIT. 
 
This paper explains and analyses various proposals tabled in the WTO non-agricultural market access negotiations using a global general equilibrium model.  The results show that proposals involving 
deeper tariff cuts imply greater increases in impo rts and exports, but greater losses in tariff revenues 
that will need to be made up in some way.  They also show greater welfare gains in the longer term, 
resulting from the improved allocation of resources a nd changes in the terms of trade, but there are 
several qualifications to this finding.  First, the overall numbers conceal important adjustments in 
individual sectors and countries, and these adjustments will normally occur in the first several years of 
the implementation of the tariff changes, while the over all benefits only start to accrue later.  Second, 
no account is taken of the potential benefits deriving from the use of tariffs for industrial policy purposes, in particular where there is a divergen ce between social and private costs and benefits 
(externalities), and the options for alternative policie s have been limited by WTO agreements.  Third, 
concomitant action is required on WTO rules and on  market entry conditions to ensure that the 
potential benefits are realised.  Under all proposals the greater adjustments would be made by 
developing countries, and it may well be that the pr oposals for deeper cuts entail going too far, too 
fast for many developing countries.  They could also lead to increased use of contingency measures 
such as anti-dumping actions.  If adjustment costs are too high, this could also endanger the reform 
process, and a more measured approach may be indicated – a case of "make haste slowly". 
 Mayer, J. (2004) Export Dynamism and Market Access. Journal of Economic Integration, vol. 
19(2), pp. 289-316. 
 
Market access liberalization has influenced product- specific growth of world exports and contributed 
to the shift in the structure of world exports of manufactures towards electrical and electronic goods 
(including parts and components), goods that requ ire high R&D expenditures, and labour-intensive 
products such as clothing.  Multilateral trade lib eralization has strongly improved market access 
conditions for manufactures and partly explains wh y manufactures have experienced particularly 
strong growth in exports.  The increased importance of vertical international production sharing and  TN/MA/S/1/Rev.1 
 Page 9 
 
 
the associated preferential trading arrangements  between geographically close countries with 
significantly different wage rates have been a key determinant of difference in export-value growth 
across individual manufactured products,  as well as of the distribution of market shares for some of 
these products among developing countries.  Projections based on a standard trade model suggest that 
moving to full trade liberalization would lead to an increase in the share of agricultural products in 
total world trade by almost two percentage points and give greater weight to the textile, clothing and 
automotive sectors within manufactured exports.   Organization for Economic Cooperation and Development (2003) The Doha Development 
Agenda: Welfare Gains from Further Multilateral Trade Liberalization With Respect to 
Tariffs . Paris: OECD.  
 
This paper aims at providing a broad perspective on the issue of potential tariff reductions under the 
DDA negotiations. To do this, it draws on two main approaches:  a review of a sample of recent 
literature and a quantitative assessment  of a variety of scenarios.  Fr om the literature, it is clear that 
the multilateral trade liberalisation can offer substantial ga ins with respect to further reductions in 
merchandise tariffs and to advancement of trade facilitation.  New studies released following the 
WTO's Doha Ministerial Conference have served to reinforce this view.  The results from the second 
approach point to the importance of market access fo r all regions, particularly developing countries.  
While improved market access for agricultural products is found to yield substantial potential 
benefits, the results highlight that potential gains fr om further liberalisation with respect to industrial 
goods may be even larger.  The findings also indi cate the potential welfare benefits from progress in 
trade facilitation, which can exceed the gains from tariff reduction for some regions under some 
scenarios.  Overall the study underscores the impo rtance to developing countries of both greater 
access to developed countries' markets as well as  their own engagement in making substantive 
commitments under the DDA.  To engage in such comm itments is in their interest and in the interest 
of the multilateral trading system as a whole.  Th e stakes involved are indeed quite large and will 
influence development prospects for years into the future.   
 
Rama, M. (2003) Globalization and Workers in Developing Countries , World Bank Policy 
Research Working Paper No. 2958, Washington, DC: World Bank. 
 
This paper reviews the academic literature on po sitive and negative effects of globalization on 
workers in developing countries, including severa l studies currently under way, and derives the 
implications for public policy.  First, it deals w ith the effects of openness to trade, foreign direct 
investment, and financial crises on average wages.  Second, it discusses the impact of exposure to world markets on the dispersion of wages by occupa tion, skill, and gender.  Third, it describes the 
pattern of job destruction and job creation associated  with globalization.  Be cause these two processes 
are not synchronized, the fourth issue addressed is the impact on unemployment rates.  Fifth, the 
paper reviews the labour market policies that can be us ed to offset the adverse effects of globalization 
on employment and labour earnings.  Finally, it discusses how the international community could 
encourage developing countries to adopt sound labour market policies in the context of globalization. 
 
Reimer, J. (2002) Estimating the Poverty Impacts of Trade Liberalization
, World Bank Policy 
Research Working Paper No. 2790, Washington, D.C.: World Bank.  
 
This survey summarizes and classifies 35 studies regarding how international trade affects the poor in 
developing countries into four methodological categories:  cross-country regression, partial-
equilibrium/cost-of-living analysis, general-equilibr ium simulation, and micro-macro synthesis.  The 
conclusion is that any analysis of trade and povert y needs to be informed by both the bottom-up, such 
as econometric analysis of hous ehold expenditure data, and top-dow n, such as general equilibrium 
models based on national accounts data, perspectives .  Indeed, recent "two-s tep" micro-macro studies 
sequentially link these two types of frameworks, such that general equilibrium mechanisms are 
incorporated along with detailed household survey information.  Another methodology similar in TN/MA/S/1/Rev.1 
Page 10  
 
spirit and also increasingly used involves the inco rporation of large numbers of surveyed households 
into a general-equilibrium simulation model.  Although most of these studies have so far been limited 
to a single region, these approaches can be readily adapted for multi-region modelling so that trade-
poverty comparisons can be made across co untries within a consistent framework.  
 
Suliman, O. (2003) Endogenous Restrictions fo r Least Developed Economies
, Review of 
International Economics, vol. 11(2) pp. 423-434. 
 The paper explores appropriate trade restrictions for least developed countries facing external terms-of-trade disturbances in terms of minimizing vari ations in the real sphere of the economy.  Two 
alternative models are explored: export-subsidy vers us import-tariff endogeneity.  The theoretical 
model indicates that the tariff regime is a more appropriate policy.  Empirical evidence from Sudan 
(1950- 1991) suggests that, although there is some discernable evidence that Sudan followed the tariff 
regime, the country did not apply the policy correc tly, adjusting the tariff mainly in response to 
foreign import prices rather than foreign export prices, which are more unstable. 
 
Wacziarg, R. and J. Seddon Wallack (2004) Trade Liberalization and Intersectoral Labor 
Movements. Journal of International Economics,  vol. 64(2), pp. 411-439.  
 
This paper examines the impact of trade libera lization episodes on movements of labour across 
sectors.  The aim is to assess  empirically whether increased trade openness leads to increased 
structural change and, if so, to what extent.  Re sults for a set of 25 liberalization episodes suggest 
weakly negative effects of liberalization on the exte nt of intersectoral labour shifts at the economy-
wide 1-digit level of disaggregation.  They do unco ver increased sectoral change after liberalization at 
the 3-digit level within manufacturing, although the estimated effects are statistically weak and small 
in magnitude.  The effects of liberalization on labour shifts differ across individual countries, in a way 
related to the scope and depth of reforms.  
 
Walkenhorst, P. (2003) Liberalising Trade in Textiles and Clothing: A Survey of Quantitative 
Studies,  Report No. TD/TC/WP(2003)2/FINAL, Paris: OECD. 
 There is a considerable body of analysis available that aims to quantify the economic and trade effects 
of textile and clothing market liberalisation.  A number of analysts at national and international 
institutions have provided their assessments.  Differ ent tools and approaches have thereby been used 
to evaluate the impacts of textile trade reform at the regional or global le vel.  Given the economic 
importance of the textile and clothing sector in some OECD and non-OECD countries and the 
resulting economy-wide repercussions that changes in  the scale and pattern of textile production will 
tend to trigger, analysis using general equilibrium models has been  dominant.  The modelling results 
consistently indicate considerable shifts in textiles and clothing production and trade as the 
Agreement on Textiles and Clothing (ATC) is impl emented.  There is pressure for a large-scale 
reallocation of resources, with  production of textile s and clothing expanding in Asian and other 
developing countries.  In paralle l, textiles and clothing production in industrialised countries is 
expected to contract significantly, while imports of textiles and clothing from developing countries 
increase.  Concerning further regional integratio n, which has played a major role in textiles and 
clothing trade during the 1990s, the modelling results  predict welfare benefits for the participating 
countries, while trade diversion is expected to adve rsely affect outsiders.  All the reviewed studies 
foresee increases in global welfare as a result of ATC reform.  But the estimates of welfare gains 
show considerable variation, with  expected annual global benefits ranging from $6.5 billion to $324 
billion.  Some studies predict ATC reform to acco unt for up to two-thirds of all gains from the 
Uruguay Round, while others put the contribution of te xtile and clothing liberalisation at merely 5 per 
cent.  There is similar discrepancy with respect to  the distribution of welfare gains.  A number of 
analysts see developing countries as the main beneficiaries of ATC reform, while others expect them 
in the aggregate to lose from the policy changes.  There is also variation in the direction and 
magnitude of expected welfare impacts at the le vel of many individual developing countries.   TN/MA/S/1/Rev.1 
 Page 11 
 
 
 
Winters, A., N. Mc Culloch, and A. Mc Kay (2004) Trade Liberalization and Poverty: the 
Evidence so far , Journal of Economic Literature, vol. XLII, pp. 72-115. 
 This paper assesses the current state of evidence on the impact of trade policy reform on poverty in 
developing countries.  The author s summarize this evidence using an analytic framework addressing 
four key areas:  economic growth and stability; households and markets;  wages and employment and 
government revenue.  They argue that there is  no simple generalizable conclusion about the 
relationship between trade liberalizat ion and poverty, and the picture is much less negative than is 
often suggested.  In the long run and on average, tr ade liberalization is likely to be strongly poverty 
alleviating, and there is no convincing evidence that it will generally incr ease overall poverty or 
vulnerability.  But there is evidence that the poor may be less well placed in the short run to protect 
themselves against adverse effects and ta ke advantage of favorable opportunities. 
  
II. STUDIES ON SPECIFIC REGIONS OR COUNTRIES 
Achterbosch, T.J., H. Ben Hammouda, P.N. Osakwe and F.W. van Tongeren (2004) Trade 
Liberalisation under the Doha Development Agenda, Options and Consequences for Africa , 
Report No 6.04.09, The Hague: Agricultur al Economics Research Institute (LEI). 
 
This study provides a quantitative estimate of th e potential economic consequences of multilateral 
trade reform under the WTO for A frica using a framework that exp licitly incorporates issues of 
concern to the region, such as pref erence erosion, loss of tariff revenu e, and trade facilitation.  It also 
examines the impact of OECD agricultural support programmes on economic welfare and 
specialization in Africa.  In the static versi on of the GTAP model, the study finds that full 
liberalization of trade would increase global welfare by 0.3 per cent, but would add 0.7 per cent 
annually to income in the African region.  Sub-Saharan Africa and, to a lesser extent, Southern Africa, 
are vulnerable to partial trade reforms as they incur losses from partial reform  while all other regions 
derive positive gains from a liberalization of minor scope.  
Aggarwal, A. (2004) Impact of Tariff Reductions on Expo rts: A Quantitative Assessment of 
Indian Exports to the United States . Working Paper No. 120, New Dehli: ICRIER. 
 
This paper quantitatively assesses likely changes in market access opportunities for Indian exports 
owing to tariff reductions by the USA.  The study identifies particular products for India at the ISIC 
4-digit level of disaggregation, which could be consider ed tariff sensitive.  Regression analysis  of the 
relationship between MFN tariff rate s and India's exports to the US was used to assess in quantitative 
terms the likely impact of tariff reduction that ma y be agreed in the Doha Round.  This analysis 
suggests that tariff cuts are not expected to benefit India's exports to the US in a major way.  With the 
full implementation of the Chairman's formula for ta riff cuts, increase in India's exports to the US 
would amount to 1.2% or 0.6% depending on the value of the B coefficient in the Chairman's formula.  
The study also decomposes changes in India's total ex ports due to tariff reduct ions in the US into the 
competitive and market effects.  The analysis suggests that the increase in India's exports would be 
mainly due to the competitive effect. 
 
Aghion, P., R. Burgess, S. Redding and F. Zilibotti (2003) The unequal effects of Liberalization: 
Theory and Evidence from India.  LSE mimeo. London, UK: LSE. 
 
This paper exploits the 1991 Indian liberalization to illustrate how such a reform may have unequal 
effects on industries and regions within a single country.   The authors find that the 1991 liberalization 
in India had strong inequalizing effects, by fostering productivity growth and profits in 3-digit 
industries that were initially closer to the Indian pr oductivity frontier and in states with more flexible 
labor market institutions.  These findings em phasize that the initial level of technology and TN/MA/S/1/Rev.1 
Page 12  
 
institutional context mattered for whether and to what  extent industries and states in India benefited 
from liberalization. 
 
Ahmed, S. and Z. Sattar (2003) Trade Liberaliza tion, Growth and Poverty Reduction, the Case 
of Bangladesh, Report No IDP- 90, Washington, DC: World Bank. 
 
This paper provides broad evidence that trade liberalization and economic deregulation in Bangladesh have contributed to growth of output and helped re duce poverty.  The policy of deregulation and trade 
liberalization started in 1976, but gained momentum in the early 1990s.  While the positive effects on 
output expansion was considerably larger in the 1 990s, corresponding broadly with a much faster pace 
of trade liberalization, the associated poverty re duction impact was higher in the 1976-90 phase of 
deregulation.  This was because employment and real wage growth was slower in the 1990s as 
compared with 1976-90.  Among the reasons for this outcome is the lack of dynamism in agriculture 
due to slower reforms.  
 
Attanasio, O., P. Goldberg and N. Pavcnik (2004) Trade reforms and Wage Inequality in 
Colombia.  Journal of Development Economics, vol. 74, pp. 331-366.  
 This paper investigates the effects of the drastic tariff reductions of the 1980s and 1990s in Colombia 
on the wage distribution.  The authors identify three main channels through which the wage 
distribution was affected: increasing returns to colle ge education, changes in industry wages that hurt 
sectors with initially lower wages and a higher fraction  of unskilled workers, an d shifts of the labour 
force towards the informal sector that typically pays  lower wages and offers no benefits.  Their results 
suggest that trade policy played a role in each of  the above cases.  The in crease in the skill premium 
was primarily driven by skilled-biased technological change;  however, their evidence suggests that 
this change may have been in part motivated by  the tariff reductions and the increased foreign 
competition to which the trade reform exposed domestic  producers.  With respect to industry wages, 
results suggest that wage premiums decreased by more in sectors that experienced larger tariff cuts.  
Finally, the authors find some evidence that the increa se in the size of the informal sector is related to 
increased foreign competition. 
 
Chen, S. and M. Ravallion (2004) Welfare Impacts of China's Accession to the World Trade 
Organization, World Bank Economic Review, vol. 18(1), pp. 29-57. 
 
Data from China's national rural and urban household surveys are used to measure and explain the 
welfare impacts of changes in goods and factor pri ces attributable to accession to the World Trade 
Organization.  The price changes are estimated se parately using a general equilibrium model to 
capture both direct and indirect effects of the initial tariff changes.  The welfare impacts are first-order 
approximations based on a household model inco rporating own-production activities calibrated to 
household-level data and imposing minimum aggregation.  The results show negligible impacts on 
inequality and poverty in the aggregate.  However, diverse impacts emerge across household types 
and regions, associated with heterogeneity in consumption behavior and income sources, with 
possible implications for compensatory policy responses.  
 
Das, D.K. (2003) Quantifying Trade Barriers: Has Protection Declined Substantially in Indian 
Manufacturing  ? Working Paper No. 105, New Delhi: ICRIER. 
 
This study undertakes a quantification of trade barriers for Indian manufacturing industries by 
examining both the tariff and the non-tariff barriers.  It documents the trade barriers for around 72 industries belonging to intermediate, capital and consumer goods sectors for the period 1980-2000 
and the phases of trade reforms therein.  The estima tes suggest levels of effe ctive rate of protection 
and percentage of imports subject to licensing declin ed during the nineties while import penetration 
rates show an increase only in the second half of  the nineties.  This suggests that there may be  TN/MA/S/1/Rev.1 
 Page 13 
 
 
considerable lags between reduction of tariffs and non-tariff barriers and measurable impact on 
imports and on the economy.  
 
Elbehri, A., T.W. Hertel and W. Martin (2003) Estimating the Impact of WTO and Domestic 
Reforms on the Indian Cotton and Textile  Sectors: A General Equilibrium Approach , Review of 
Development Economics, vol. 7(3), pp. 343-359.  
 
The agreement to abolish the quotas on textile s and clothing introduced under the Multi-fiber 
Arrangement (MFA) will create a new and much more  competitive world market for India's exports 
of textiles and clothing.  India's inefficient and cost ly policies, such as cott on export quotas, the hank 
yarn obligation, and the restrictive policies on foreign investment that have held back productivity in the Indian apparel sector, will impose serious cost s.  The authors consider the implications of 
reforming these policies in an open trading en vironment using a multiregion, applied general-
equilibrium model.  They find that the costs of th ese policies to India increase substantially following 
abolition of the MFA;  the benefits to India from  domestic reforms are considerably enhanced when 
there is global free trade in textiles and apparel. 
 
Evans, C.L. and J. Harrigan (2004) Tight Clothing: How the MFA Affects Asian Apparel 
Exports,  NBER Working Paper No. w10250, Cambridge, MA: NBER. 
 
International trade in apparel and textiles is regu lated by a system of b ilateral tariffs and quotas 
known as the Multifiber Arrangement or MFA.  Using a time series of detailed product-level data 
from the United States on the quotas and tariffs th at comprise the MFA, the authors analyze how the 
MFA affects the sources and prices of US apparel imports, with a particular focus on the effects on 
East Asian exporters during the 1990s.  They show that while a large fraction of US apparel is 
imported under binding quotas, ther e are many quotas that remain unfilled.  They also show that 
binding quotas substantially raise import prices, su ggesting both quality upgrading and rent capture by 
exporters.  In contrast, tariffs reduce import prices.  Lastly, they argue that the substantial shift of US 
apparel imports away from Asia in favor of Mexico and the Caribbean during the 1990s is only partly 
due to discriminatory trade policy:  the other reas on is an increasing demand for timely delivery that 
gives a competitive advantag e to nearby exporters. 
 
Fernandes, A.M. (2003) Trade Policy, Trade Volumes and Plant-Level Productivity in 
Colombian Manufacturing Industries.  World Bank Policy Research Working Paper No. 3064, 
Washington, D.C.: World Bank. 
 
This paper explores Colombian trade policy during 1977-1991, a period of substantial variation in 
protection across industries, to examine whether increased exposure to foreign competition generates 
plant-level productivity gains.  Using a large pane l of manufacturing plants, the authors find a strong 
positive impact of tariff liberalization on consistent  productivity estimates, controlling for plant and 
industry heterogeneity.  This result is not driven by the endogeneity of protection nor by plant exit. 
The impact of tariff liber alization on productivity is stronger for large plants and for plants in less 
competitive industries. Qualitatively similar results  are obtained when using effective rates of 
protection and import penetration ratios as measures of protection. 
 
Fontagné, L., T. Mayer and S. Zignago (2004) Trade in the Triad: How Easy is the Access to 
Large Markets ?  CEPR Discussion Paper No. 4442, London: CEPR. 
 
This paper identifies the level of trade integration between the three largest economic powers of the 
world, often called the Triad:  the United States, the EU and Japan.  The authors focus on measuring 
possible asymmetries in market access between members of the Triad using border effects between 
each of those partners.  They investigate trends of bilateral trade openness and show notably that there 
has been a deterioration of the relative access of Japanese exporters on both the American and EU 
markets in the 1990s.  Results also show which in dustries have the most asymmetric market access TN/MA/S/1/Rev.1 
Page 14  
 
among the different combinations of those partners.  The authors finally provide explanations for the 
estimated border effects using prox ies for bilateral observed protection (tariffs and NTBs), home bias 
of consumers, product diffe rentiation and levels of FDI.  Tariffs  still matter in shaping trade patterns 
even in cases where those tariffs are low in magnitude.  The explanations related to actual protection, 
home bias and substitutability of goods put together explain a large part of the border effect between 
blocs of the triad, although they do not explain the whole of the border effect puzzle. 
 
Francois, J. and D. Spinanger (2004) Regulated Efficiency, World Trade Organization 
Accession and the Motor Vehicle Sector in China , CEPR Discussion Paper No. 4439, London: 
CEPR.  
This Paper is concerned with the interaction of regulated efficiency and World Trade Organization 
(WTO) accession and its impact on China's motor vehi cle sector.  The analysis is conducted using a 
23-sector/25-region computable general equilibrium model. Regulatory reform and internal 
restructuring are found to be critical .  Restructuring is represented by a cost reduction following from 
consolidation and rationalization that moves costs to ward global norms.  Without restructuring, WTO 
accession means a surge of final imports, though impo rts of parts could well fall as production moves 
offshore.  With restructuring, however, the final a ssembly industry can be made competitive by world 
standards, with a strengthened position for the industry. 
 
Gilbert, J. (2003) Trade Liberalization and Employment in Developing Economies of the 
Americas, Integration and Trade Journal No. 18, Buenos Aires: INTAL.   Using an applied general equilibriu m model, this paper explores the potential effect of comprehensive 
trade liberalization in a selection of Latin Americ an developing economies.  Over the last decade 
many of these economies have suffered from high levels of unemployment, and the consequences of 
reform on unemployment and of unemployment on the ef fects of reform are critical.  The author takes 
the approach of utilizing alternative labor market cl osures, bounding the static effect of trade reform 
between the neoclassical, which abstracts from unemployment issues, and a surplus 
labor/unemployment closure.  The author also considers a less common specification based on the 
neoclassical Harris-Todaro characterization of the dual economy.  Our results indicate that the 
presence of unemployment may significantly expand the potential net welfare benefits of trade reform 
in the Americas. 
 
Harrison, G.W., T.F. Rutherford, D.G. Tarr and A. Gurgel (2003) Regional, Multilateral and 
Unilateral Trade Policies of MERCOSUR for Growth and Poverty Reduction in Brazil,  World 
Bank Policy Research Working Paper No . 3051, Washington, DC: World Bank. 
 The paper employs a 16-region global computable  general equilibrium model to quantitatively 
examine the regional, unilateral and multilateral ar rangements.  The model includes the Brazilian as 
well as the economies of Argentina, Uruguay, Chile, Mexico, the United States, Canada, Central 
America, Venezuela, Colombia, Peru, Rest of the Andean Pact, Rest of South America, the EU, Japan 
and an aggregate Rest of the World.  The authors are thus able to estimate the impact on partner and 
excluded countries from each of the agreements that are evaluated.  Results suggest that the FTAA, 
the EU-MERCOSUR agreement and multilateral trade polic y changes will all be beneficial for Brazil.  
The Brazilian government strategy of simultan eously negotiating the FTAA, the EU-MERCOSUR 
agreement while supporting multilateral liberaliza tion through the Doha Agenda will increase the 
benefits of each of these policies. 
 
Haskel, J.E. and M.J. Slaughter (2003) Have Falling Tariffs and Transportation Costs Raised 
US Wage Inequality  ? Review of International Economics, vol. 11(4), pp. 630-650. 
 To gauge the effect of international trade on the risi ng US skill premium, the paper analyzes the sector 
bias of price changes induced by changes in US tariff s and transportation costs.  It is found that, in  TN/MA/S/1/Rev.1 
 Page 15 
 
 
both the 1970s and 1980s, cuts in tariffs and transp ortation cost levels were concentrated in unskilled-
intensive sectors.  Despite this suggestive eviden ce, the authors estimate that price changes induced 
by tariffs or transportation co sts mandated a rise in inequality that was mostly statistically 
insignificant.  Thus, they do not find strong evidence that falling tariffs and transport costs, working 
through price changes, mandated rises in inequality. 
 
Hertel, T.W., P.V. Preckel, J.A.L. Cranfield and M. Ivanic (2003) Multilateral Trade 
Liberalization and Poverty in Brazil and Chile,  Integration and Trade Journal No. 18, Buenos 
Aires: INTAL. 
 
Poverty reduction is an increasingly important cons ideration in the deliberat ions over bilateral and 
multilateral trade liberalization.  However, most p overty studies have focused on a single country 
using detailed household survey data.  When it co mes to multi-country, global trade liberalization 
analyses, researchers are forced to resort to a discussion of average, or per capita effects.  This 
severely limits their capacity to address the povert y question.  This paper combines results from a 
newly available international, cross section consum ption analysis, with earnings data from household 
surveys from Brazil and Chile, to analyze the im plications of multilateral trade liberalization for 
impoverished households in these two countries.  Th e multilateral trade liberaliz ation scenario that the 
authors examine involves complete elimination of merchandise tariff barriers as well as textile and 
apparel quotas in place in 1997.  This ignores the potential impact of other non tariff barriers as well 
as the significant barriers to trade and investment  in services and trade distorting domestic farm 
policies.  While this liberalization scenario is styl ized, it offers a useful benchmark for assessing the 
potential poverty impacts of multilateral measures.  The authors find that the aggregate poverty 
measure is reduced in the short run in bo th Brazil and Chile, fo llowing multilateral trade 
liberalization.  However, this aggregate result does not do justice to the differential household impacts 
by earning specialization.  Agriculture specialized  households in both countries experience a very 
large reduction in poverty, while non-agriculture profits-specialized and wage-labour households 
experience an increase in poverty fo llowing multilateral trade liberalization. 
 Hinkle, L., A. Herrou-Aragon and K. Kubota (2003) How Far Did Africa's First Generation 
Trade Reforms Go? An intermediate Methodology for Comparative Analysis of Trade Policies, 
Volume I
 and II: Main Report, Africa Region Working Paper Series, No. 58, Washington, DC: 
World Bank. 
 
This paper presents an intermediate methodology for evaluating trade regimes in SSA.  The 
methodology permits a quantitative instrument-by-in strument assessment of the conventional border 
instruments of trade policy.  The paper finds that, although the best practice countries in their sample 
had not yet caught up with all of the best practices  observed elsewhere in the developing world, "first 
generation trade reforms" in the 1990s had led to  significant liberalization.  Despite progress in 
rationalizing tariff structures, however, lowering rate s and eliminating quantitati ve restrictions, trade 
policies maintain a bias in favour of import-competing activities over exports.   Hoda, A. and M. Verma (2004) Market Access Negotiations on Non-Agricultural Products: 
India and the Choice of Modalities,  Working Paper No. 132, New Delhi: ICRIER. 
 
The paper aims at facilitating the process of developm ent of the position that would be in the best 
interest of India in future discussion on the moda lities for tariff negotiations.  The authors have taken 
the view that there are good reasons for India to  be ambitious in its outlook and proactive in 
approaching the negotiations.  India has liberalized its tariffs at a pace that seemed unthinkable before the onset of economic reforms.  There is harmony in the views of the political executive and 
economists that the trend must be maintained. India has a large repertoire of concessions that it can 
trade for getting reciprocal concessions in return.  Further in the context of the wave of regional 
integration arrangements that is sweeping across the world, steep reduction in the non-discriminatory 
tariffs is the only way in which no n-participants in major regional ar rangements can alleviate the trade TN/MA/S/1/Rev.1 
Page 16  
 
diversion effect of preferential arrangements.  As for modalities, the authors recommend that a non-
linear formula which attaches weight to the tariff av erage of the country concerned would be in India's 
best interest.  They advocate that if participation in sectorial liberalization is to be mandatory, India 
must ask for the possibility for developing countries to retain the flexibility to set the tariff at five per 
cent.  The authors do not favour placing great reliance on the concept of special and differential 
treatment. 
 
Ianchovichina, E. and W. Martin (2004) Impa cts of China's Accession to the World Trade 
Organization, World Bank Economic Review, vol. 18(1), pp. 3-27. 
 
This article presents estimates of the impact of China's accession
 to the World Trade Organization. 
China is estimated to be the biggest beneficiary (US$31 billio n a year from trade reforms in 
preparation for accession and additional gains of $10 billion a year from reforms after accession), 
followed by its major trading partners that also undertake liberalization, including the economies in 
North America, Western Europe, and Taiwan (China). Accession will boost manufacturing sectors in 
China, especially textiles and apparel, which will be nefit directly from the removal of export quotas.  
Developing economies competing with China in third markets may suffer small losses.  Accession 
will have important distributional consequences for China, with the wages of skilled and unskilled 
non-farm workers rising in real terms and relative to those of farm workers.  Possible policy changes, 
including reductions in barriers to labor mobility and improvements in rural education, could more 
than offset these negative impacts and facilitate the development of China's economy.  
 Kulundu Manda, D. (2002) Globalization and the Labour Market in Kenya,
 Paper prepared as 
part of the DFID funded research project "Glo balization, Production and Poverty", Nairobi: 
Kippra.  
This paper analyses the effect of globalization on the labour market outcomes in Kenya using micro 
datasets complemented with secondary data.  Th e analysis shows that during the economic reform 
period employment creation dramatically increased in the informal sector, but most of the jobs created 
in the sector are more insecure due to low survival rate of firms in the sector and pay less compared 
with jobs lost in the formal sector.  Some jobs we re created in the export processing zones. Labour 
force participation in the urban areas increased fo r both men and women but declined in the rural 
areas especially for women.  Unemployment also increased both in rural and urban areas and 
especially for women in the urban areas.  The increase in unemployment and the expansion in the 
informal sector employment is partly due to retr enchment in the civil service, increased school 
dropout, collapse of some private firms and re trenchment in other private firms due to stiff 
competition from imports following trade liberalization.   The period also experienced a shift in labour 
demand in favour of highly skilled labour, a decline in permanent full-time workers and an increase in 
part-time workers and casual workers signalling a co st cutting strategy where firms replace permanent 
employees with part time and casual workers to make  savings in terms of paying less benefits.  Real 
earnings for all workers declined during the reform  period until the mid-1990s when they started 
increasing again.  Less skilled workers experience d losses in earnings compared with highly skilled 
workers as shown by increasing private returns  to university education and declining returns to 
primary and secondary education.  With increased un employment especially for women, insecure jobs 
in the informal sector and declining earnings for the majority of less skilled labour during the period, 
more people are likely to be poor. 
 
Litchfield, J. and N. McCulloch (2003) Poverty in Zambia: Assessing the Impacts of Trade 
Liberalization in the 1990s,  PRUS Working Paper No. 16, Brighton, UK: Poverty Research Unit 
at Sussex. 
 
This paper summarizes some of the key features of the changes in poverty between 1991 and 1998 in 
Zambia, disaggregating the findings by geographical location and other socio-economic categories.   TN/MA/S/1/Rev.1 
 Page 17 
 
 
The paper also summarizes some of the essential fe atures of the reforms in the 1990s and sets out a 
number of alternative approaches for analyzing the impacts of these reforms on poverty. Some 
preliminary results suggest that in urban areas, opening of markets to international imports did result 
in closures of businesses.  In rural areas, redunda ncies resulting from privatization of parastatals had 
important impacts on living standards.  
 
Muendler, M.A. (2004) Trade, Technology, and Productivity: A Study of Brazilian 
Manufacturers, 1986-1998.  University of California, San Diego.  
 
Brazil's trade liberalization between 1990 and 1993, and its partial reversal in 1995, are used to study 
how reduced inward trade barrie rs affect productivity.  The production function of Brazilian 
manufacturers is estimated at the ISIC3 two-digit level under various alternatives.  Firm-level 
productivity is inferred and then related to trade.  Findings suggest that (1) foreign competition 
pressures firms to raise productivity markedly, whereas (2) the use of foreign inputs plays a minor 
role for productivity change.  (3) The shutdown probability of inefficient firms rises with competition 
from abroad, thus contributing positively to aggregate productivity.  Counterfactual simulations indicate that the competitive push (1) is an impo rtant source of immediate productivity change, while 
the elimination of inefficient firms (3) unfolds its impact slowly. 
 
Mujeri, M. and B. Khondker (2002) Poverty Implications of Trade Liberalization in 
Bangladesh: A General Equilibrium Approach,  Paper funded by DFID as part of the 
Globalization and Poverty Programme, Dhaka: University of Dhaka.  The aim of the analysis is to contribute to better understanding of the relationships between trade liberalization policies and poverty in Bangladesh, an d help identify policy options that are capable of 
promoting liberalization in a more equitable manner.  The analysis in the present study indicates that 
the gains are relatively small and these differ acro ss various household groups in the presence of 
structural bottlenecks and other constraints.  In pa rticular, the gains accrue more to the relatively 
welloff households while the extreme poor households benefit less.  This indicates that the full 
potential of globalization is not readily translated in to poverty reduction in Bangladesh.  In order to 
make the liberalization policies sufficiently pro- poor, the process needs complementary measures 
aiming at strengthening the institutional capabil ities, addressing the structural bottlenecks, and 
improving the anti-poverty policy regimes in the country.   In addition to ensuring the consistency of the macroeconomic policy regime with the globalizati on efforts, this would require that the process be 
made sensitive to the social costs and shaped by domestic policy regimes, be consistent with 
appropriately targeted social safety nets measures for the affected poor and guided by the institutional 
capacity to manage the transition process. 
 
Pandey, M. (2004) Impact of Trade Liberalization in Ma nufacturing Industry in India in the 
1980s and 1990s,  Working Paper No. 140, New Delhi: ICRIER. 
 This study seeks to examine evidence on the relationship between trade policy and industry 
performance for India during the 1980s and 1990s, to assess whether changes in policy has 
significantly affected industry performance.  The au thor takes a broad-based approach and considers 
the linkage between trade policy variables and a number of industry performance variables, including 
production, employment, labour, productivity, averag e wage, profitability, price-cost margin, export 
intensity and import penetration.  An important i ssue addressed is the quan tification of trade policy 
variables.  The study focuses on coverage ratios of  non-tariff barriers, nominal and effective rates of 
protection as measures of trade policy.  Although ther e is evidence of some impact of trade policy on 
industry performance, the study does not find any conclusive links between the two. 
 TN/MA/S/1/Rev.1 
Page 18  
 
Pavcnik, N. (2002) Trade Liberalization, Exit  and Productivity Improvements: Evidence from 
Chilean Plants. Review of Economic Studies, vol. 69, pp. 245-76.  This paper empirically investigates the effects of lib eralized trade on plant pr oductivity in the case of 
Chile.  Chile presents an interesting setting to st udy this relationship since it underwent a massive 
trade liberalization that significantly exposed its plants to competition from abroad during the late 
1970s and early 1980s.  Using plant-level panel data  on Chilean manufacturers, the author find 
evidence of within  plant productivity improvements that can be attributed to a liberalized trade for the 
plants in the import-competing sector.  In many cases, aggregate productivity improvements stem 
from the reshuffling of resour ces and output from less to more efficient producers. 
 
Pavcnik, N., A. Blom, P.K. Goldberg and N. Schady (2004) Trade Polic y and Industry Wage 
Structure: Evidence from Brazil. World Bank Economic Review, forthcoming.   
 
This paper analyses the impact of the 1988-1994 tr ade liberalization in Brazil on the industry wage 
structure.  Empirical results sugges t that while industry affiliation is in fact an important component 
of worker earnings, the structure of industry wage  premiums is relatively stable over time.  The 
authors thus find no statistical association between changes in industry wage premiums and changes 
in trade policy.  Furthermore, they do not find an y relationship between industry-specific premiums to 
university graduates and trade policy.  They conc lude that trade liberalization in Brazil did not 
significantly contribute to increased wage ine quality between the skilled and unskilled workers 
through changes in industry wage premiums.  
 Porto, G. (2004) Using Survey Data to Assess the Distributional Effects of Trade Policy.
 World 
Bank Policy Research Working Paper No . 3137, Washington, DC: World Bank. 
 
The purpose of this paper is to develop and apply a methodology to empirically explore the effects of 
trade policies on the distribution of income and poverty in developing countries.  The main finding of 
the paper is that Mercosur benefits the average Argentine household across the entire income 
distribution.  There is evidence of a pro-poor bias of the regional trade agreement: on average, poor 
households gain more from the reform than middle-income households, whereas the impacts on rich 
families are positive but not statistically significant.  The reason behind these results is that Argentine 
trade policy protected the rich over the poor, prior to the reform, and granted some protection to the 
poor, after the reform.  As a result, the relative pre-Mercosur tariff on the goods investigated in this 
paper is higher on relatively skill-intensive goods.  This means that tariff removals would tend to 
benefit the poor over the rich.  These findings indi cate that trade reforms may actually help improve 
the distribution of income and reduce poverty in the country.  
 
Porto, G. (2004) Trade Reforms, Market Access and Poverty in Argentina . Policy Research 
Working Papers, No. 3135, World Bank. 
 
The purpose of this paper is to empirically co mpare the relative poverty impacts of national and 
foreign trade reforms in Argentina.  The national tr ade reforms investigated in this paper include tariff 
cuts on consumption goods and capital goods in Argentina.  These policies generate a decline in the 
domestic relative price of these goods.  Foreign tr ade reforms include the elimination, in developed 
countries, of agricultural subsidies and trade ba rriers on agricultural manufactures and industrial 
manufactures.  These policies enhance the market access of Argentine exports and cause an increase 
in the international (and hence in the domestic) relative price of these goods.  It is found that national trade reforms have larger marginal effects than fore ign trade reforms.  However, since there is greater 
room for foreign reforms, policy changes in deve loped countries would have, in the end, larger 
poverty impacts.  Overall, a combination of own reforms and enhanced market access would cause 
poverty to decline by between 1.7 and 4.6 per centage points.  With an actual initial head count ratio 
of 25.7 per cent, this evidence suggests that trade policies can be important poverty-reducing 
instruments in Argentina.  TN/MA/S/1/Rev.1 
 Page 19 
 
 
 
Ravallion, M. and M. Lokshin (2004) Gainers and Losers from Trade Reform in Morocco,  
World Bank Policy Research Working Paper No. 3368, Washington, DC: World Bank.  
 Ravallion and Lokshin use Morocco's national survey of living standards to measure the short-term 
welfare impacts of prior estimates of the price chan ges attributed to variou s trade policy reforms for 
cereals.  They find small impacts on mean consum ption and inequality in the aggregate.  There are 
both gainers and losers and (contrary to past claims) the rural poor are worse off on average after 
trade policy reforms.  The author s decompose the aggregate impact on inequality into a "vertical" 
component (between people at different pre-reform welfare levels) and a "horizontal" component (between people at the same pre-reform welfare level).  There is a large horizontal component which dominates the vertical impact of full de-protection.  The diverse impacts reflect a degree of observable 
heterogeneity in consumption behaviour and income sources, with implications for social protection 
policies.  
 
Topalova, P. (2004) Trade Liberalization and Firm Productivity: The Case of India.
 IMF 
Working Paper No. 04/28. Washington, DC: IMF. 
 Using a panel of firm-level data, this paper examines  the effects of India's trade reforms in the early 
1990s on firm productivity in the manufacturing sector, focusing on the interaction between this 
policy shock and firm and environment characteristics.  The rapid and comprehensive tariff reductions-part of an IMF-supported adjustment program with India in 1991-allow the author to establish a causal link between variations in inter- industry and intertemporal tariffs and consistently 
estimated firm productivity.  Specifically, reductions in trade protectionism lead to higher levels and 
growth of firm productivity, with this effect strong est for private companies.  Interestingly, state-level 
characteristics, such as labor regulations, invest ment climate, and financial development, do not 
appear to influence the effect of trade liberalization on firm productivity. 
 Virmani, A., B. Goldar, C. Veeramani and V. Bhatt (2004) Impact of Tariff Reforms on Indian 
Industry: Assessment Based on a Multi-Sector Econometric Model,  Working Paper No. 135, 
New Delhi: ICRIER. 
 
This study is an attempt to gauge the impact of reductions in tariffs on the Indian manufacturing 
sector using a multiple-equations dis-aggregated econ ometric model.  The results of the study suggest 
that a substantial reduction in tariff rates, bri nging down the import-weighted average for industrial 
products from about 20 per cent as prevailing in the beginning of 2003-2004 to about 10 per cent would have only marginal impact on net exports, value of production and employment in the 
organised manufacturing sector.  It seems no sign ificant adverse impact would be there on the 
domestic industrial sector from the tariff cuts.  Rather, a small increase in aggregate industrial 
production and employment might occur emanating from the efficiency enhancing effects of tariff 
reform.  However, a detailed sector-wise analysis indicates that the impact of tariff reforms would be 
differentiated across products, with firms in so me industries gaining and firms in some other 
industries losing in terms of net export s, value of production and employment. 
 
 
III. NON-RECIPROCAL PREFERENCES 
Alexandraki, K., and H.-P. Lankes (2004) The Impact of Preference Erosion on Middle-Income 
Developing Countries.  IMF Working Paper No. 04/169, Washington, DC: IMF. 
 Preference erosion has become an obstacle to multilatera l trade liberalization, as beneficiaries of trade 
preferences have an incentive to resist reductions in most-favored-nation (MFN) tariffs.  This study 
identifies middle-income developing countries that are vulnerable to export revenue loss from 
preference erosion.  It concludes that the problem is heavily concentrated in a sub-set of preference TN/MA/S/1/Rev.1 
Page 20  
 
beneficiaries – primarily small island economies de pendent on sugar, banana, and – to a lesser extent 
– textile exports.  Accordingly, measures to help mitigate the impact of preference erosion can be 
closely targeted at the countries at risk. 
 
Bartels, L. (2003) The WTO Enabling Clause and Positive Conditionality in the European 
Community's GSP Program . Journal of International Economic Law, vol. 6(2), pp. 507-532.  
 This paper examines the legality of positive conditionality in the EC's GSP program.  It can be 
concluded that, despite some ambiguity in the 2001 Doha Decision on Implementation, GSP trade 
preferences do have to meet the description of ge neralized, non-reciprocal and non- discriminatory in 
order to benefit from the Enabling Clause.  This is primary because of the next of the Enabling Clause 
and the GSP Decision, but it is also supported by the public position of the EC and, through less 
conclusively, the US.  What is still in dispute is whether these three conditions present a legal obstacle 
for non-trade conditionality in a de veloped country GSP program.   
 
Brenton, P. (2003) Integrating the least Developed Countries into the World Trading System: 
The Current Impact of EU Preferences under Everything But Arms . World Bank Policy 
Research Working Paper No. 3018, Washington, DC: World Bank. 
 
Trade preferences are a key element in industrial c ountries' efforts to assist the integration of least 
developed countries (LDCs) into the world economy.  Brenton provides an initial evaluation of the impact of the European Union's recently introduced "Everything but Arms" (EBA) initiative on the products currently exported by the LDCs.  He shows that the changes introduced by the EBA 
initiative in 2001 are relatively minor for currentl y exported products, primarily because over 99 per 
cent of EU imports from the LDCs are in produc ts which the EU had already liberalized, and the 
complete removal of barriers to the key remaining products – rice, sugar, and bananas – has been 
delayed.  Brenton looks at the role EU preference s to LDCs in general have been playing and could 
play in assisting the integration of  the LDCs.  He shows that there is considerable variation across 
countries in the potential impact that EU preference s can have given current export structures.  There 
is a group of LDCs for whom EU trade preferences on existing exports are not significant since these 
exports are mainly of products where the most-favored-nation duty is zero.  Export diversification is 
the key issue for these countries.  For other LDCs , EU preferences have the potential to provide a 
more substantial impact on trade.  However, the author shows that only 50 per cent of EU imports 
from non-ACP (Africa, Caribbean, and Pacific) LDCs which are eligible actually request preferential 
access to the EU.  The prime suspect for this low level of use are the rules of origin, both the 
restrictiveness of the requirements on sufficient proc essing and the costs and difficulties of providing 
the necessary documentation.  More simple rules of origin are likely to enhance the impact of EU 
trade preferences in terms of improving market access and in stimulating diversification toward a 
broader range of exports.  
 Brenton, P., and T. Ikezuki (2004) Preference Utilization and Preference Margins – What do 
Variations Across Countries tell Us? Some In itial Observations. Mimeo. Washington DC: 
World Bank.  
 
This paper presents information on the utilization of non-reciprocal preferences granted by the EU, 
US and Japan to a common group of mainly LDC developing countries beneficiaries.  The 
conclusions are that the utilization of trade preferen ces vary across beneficiaries of particular schemes 
and across schemes for a particular beneficiary.  Th is implies that the impact of preference erosion 
following multilateral negotiations to reduce MFN ta riffs will fall more heavily on some countries 
(those with higher utilization rates) than others.  Fu rther, it is argued that developing countries should 
provide greater flexibility in satisfying the requirem ents to demonstrate that sufficient processing has 
be undertaken to justify preferential access.  Rules of origin which provide for alternative methods for 
satisfying sufficient processing are more likely to  lead to higher rates of  utilisation of available 
preferences.  TN/MA/S/1/Rev.1 
 Page 21 
 
 
Brenton, P., and T. Ikezuki (2004) The Initial and Potential Impact of Preferential Access to the 
U.S. Market under the African Growth and Opportunity Act.  World Bank Policy Research 
Working Paper No. 3262, Washington, DC: World Bank. 
 The ability to export clothing products under preferen ces with liberal rules of origin is the key factor 
currently determining whether the African Growth and Opportunity Act (AGOA) has a significant 
impact on non-oil exporting African countries.  At present only a small number of countries receive 
substantial benefits and least develo ped countries that do not receive preferences for clothing have yet 
to see an impact of AGOA on their overall export s.  However, the benefits from exporting clothing 
under AGOA appear fragile in the face of the removal of quotas in the United States on major 
suppliers, such as China, at the end of 2004, and the planned removal of the liberal rules of origin that allow for the global sourcing of fabrics from least-cost locations.  To entrench and enhance the 
benefits of AGOA, it is important that the scheme be extended over a much lo nger period, if not made 
permanent, and the special liberal rules of origin  for clothing products be extended considerably 
beyond 2004.  The effective inclusion of textile products and a number of high-duty agricultural 
products would also help to broa den the range of opportunities for African exporters in the U.S.  
market.  Nevertheless it is important that the op portunities created by AGOA are integrated into a 
broader framework for promoting trade and that it be  recognized that if the opportunities offered by 
more open trade are to be exploited, there must be  concerted efforts to improve the environment for 
investment countries covered by AGOA.  
Brenton, P. and T. Ikezuki (2004) The value of Trade Preferences for Africa, Mimeo, Washington, DC: The World Bank. 
 
This paper assesses the non-reciprocal preference s granted by the EU, US  and Japan to African 
countries. The paper presents the calculated value of the available preferences to each African 
beneficiary and the extent to which the available pref erences are actually taken up.  This shows that a 
very small number of beneficiaries receive substan tial transfers but that for the vast majority of 
developing countries in sub-Saharan Africa the valu e of preferences does not amount to a significant 
proportion of the value of exports.  We do find wi de variation in the take-up of preferences both 
across beneficiaries of a particular scheme an d across the different schemes for a particular 
beneficiary.  
 
Brenton, P., and M. Manchin (2003) Making EU Trade Agreements Work: The Role of Rules of 
Origin . The World Economy, Vol. 26 (5), pp. 755-770.  
 
A key element of the EU's free trade and preferential trade agreements is the extent to which they 
deliver improved market access and so contribute to the EUs foreign policy objectives towards 
developing countries and neighbouring countries in Europe, including the countries of the Balkans.  
Previous preferential trade schemes have been inef fective in delivering improved access to the EU 
market.  The main reason for this is probably the very  restrictive rules of origin that the EU imposes, 
coupled with the costs of proving consistency with these rules.  If the EU wants the 'Everything but 
Arms' agreement and free trade agreements with co untries in the Balkans to   generate substantial 
improvements in access to the EU market for pro ducts from these countrie s then it will have to 
reconsider the current rules of origin and implemen t less restrictive rules backed upon by a careful 
safeguards policy. 
 
Candau, F., L. Fontagné, and S. Jean (2004) The Utilization rate of Preferences in the EU . 
Prepared for the Technical Workshop on Tari ff Preferences and their Utilization, Geneva: 
WTO.   This paper studies the effectiveness of EU's pr eferential agreements in granting their partners 
improved market access.  The utilization of preference s varies across receiver s of particular markets 
and across markets for a particular receiver.  In many LDC African countries, preferences are TN/MA/S/1/Rev.1 
Page 22  
 
systematically underutilized.  It is also pointed out in the paper that a pr eferential agreement never 
covers all products, and all product coverage varies widely across agreements.  How each set of 
preferences is actually utilized is tightly associated to the sequence of  their implementation, and to the 
associated level of preference and administrative constraint.  
 
Dean, M.J. (2003) Do Preferential Trade Agreements Promote Growth? An Evaluation of the 
Caribbean Basin Economic Recovery Act . Document No. 2002-07-A, Washington DC: U.S. 
International Trade Commission. 
 
The few empirical studies which examine the effects of preferential trade liberalization on growth find 
no direct relationship between membership in a PTA and growth across countries.  This is somewhat 
surprising, given the large literature which argues that  trade liberalization is likely to encourage more 
rapid growth.  However, sensitivity analysis has shown that this link between freer trade and growth 
may be indirect, as freer trade strongly increases in vestment, and higher investment strongly increases 
growth.  This paper tests for both direct and indi rect effects of preferential trade liberalization on 
growth and investment, by examining the impact of the Caribbean Basin Economic Recovery Act – a non-reciprocal PTA implemented by the US in 1 984 to encourage growth and development in 
Caribbean and Central American countries.  Results suggest that CBERA did not result in any "trade-
induced investment-led growth."  It may have had a direct impact on growth in the region, but the 
effect was small, and significant only when combin ed with trade and foreign exchange reforms on the 
part of the beneficiary countries themselves.  However, preferential trade liberalization through the production-sharing program, and unilateral and region al trade reforms in beneficiary countries and in 
the US did lead to investment-led growth, and to higher  growth directly, in the CBERA countries. 
 
Estevadeordal, A., and K. Suominen (2004) Rules of Origin: A World Map and Trade Effects. 
Paper prepared for the Seventh Annual Confer ence on Global Economic Analysis: Trade, 
Poverty, and the Environment,  Washington, DC: World Bank. 
 The paper focuses on capturing the effects of PTAs and rules of origin (RoO), a crucial yet poorly 
understood market access discipline included in virtually every PTA. Five main findings are 
concluded.  First, the most recent wave of PTA fo rmation that started swelling in the 1990s forged in 
regimes with unprecedently restrictive and complex product-specific RoO - while compensating these 
features with relatively lenient regime-wide RoO.  Second, assessing the trade effects of RoO, the 
authors find that regimes with restrictive RoO and with high degrees of sectoral selectivity in RoO 
discourage aggregate trade flows.  Third, regime-wide RoO that allow for flexibility in the application 
of product-specific RoO, such as cumulation and drawback, facilitate trade flows.  As such, various regime-wide RoO provisions can counteract restrictive product-specific RoO's negative effects on 
trade.  Fourth, at the sectoral level, both rest rictive RoO and selectivity in RoO in final goods 
encourage trade in intermediate goods, and can thus entail trade diversion in inputs.  Fifth, exporters 
and producers learn over time to comply with stri ngent product-specific RoO, and to take greater 
advantage of permissive regime-wide provisions: "RoO learning" gradually reduces "RoO 
interference".  
 
Haveman, J.D. and H.J. Shatz (2004) Deve loped Country Trade Barriers and the Least 
Developed Countries: The Current situation. Jour nal of Economic Integration, vol. 19(2), pp. 
230-270.  In the 2001 Doha Development Round ministerial de claration, countries committed themselves "to 
the object of duty-free, quota-free market access fo r products originating from LDCs." In this light, 
this paper investigates the current tariff barriers put in place and preferences granted by the Triad 
countries regarding products from LDCs.  It first investigates preferences in policy - the simple 
average tariffs faced by LDCs - and then looks at ba rriers in practice, analysing the extent to which 
LDCs have been able to take advantage of the vari ety of preferences granted.  It also explores the 
LDC tariff barrier against goods from other countries.  It finds that tariff barriers against LDC  TN/MA/S/1/Rev.1 
 Page 23 
 
 
products have been fallen dramatically and are espe cially low in the EU.  However, barriers remain 
against certain products in which LDC specialize, so  that U.S. import-weighted tariff for LDC good 
are actually higher than U.S. import-weighted tariffs for countries subject to MFN tariffs.  
Furthermore, the LDC themselves tend to favour goods from the advanced industrial countries.  These 
results indicate that there is still much room for tariff reductions for LDC goods, especially in the 
U.S., and that such reductions must take account of LDC produc tion capabilities.   
 
Ianchovichina, E., A. Mattoo  and M. Olarreaga (2001) " Unrestricted Market Access for Sub-
Saharan Africa: How Much is it Worth and Who Pays ," World Bank Policy Research Working 
Paper No. 2595. Washington, DC: World Bank.  
Initiatives to improve market access for the poorest countries have recently been announced by the 
European Union, Japan, and the United States.  This  paper assesses the impact of these initiatives and 
others that might be taken on a subset of 37 Sub-Saharan African countries (SSA-37) of these 
initiatives and others that might be taken.  The au thors find that fully unrestricted access to all the 
QUAD countries would produce substantial gains for SSA-37, leading to a 14 per cent increase in non-oil exports ($2.5 billion) and boosting real incomes in SSA-37 by around 1 per cent.  Most of 
these gains would come from preferential access to the highly protected Japanese and European 
agricultural markets.  The smallness of SSA-37 ensures that the costs of trade diversion for the 
QUAD, other developing countries and the world as a whole are negligible. 
 
Inama, S. (2002) Market Access for LDCs - Issues to Be Addressed. Journal of World Trade, 
vol. 36(1), pp. 85-116.   This article provides suggestions on ways to ensure that the actual initiatives for improved market 
access to the LDCs, result in trade preferences having the expected developmental effect.  It points 
out that, notwithstanding the importance of expanding preferences to cover all products, product 
coverage itself represents only one of the several dimensions to substantia lly enhance market access 
conditions for LDCs' exports.  Equally, or more im portant, is the utilisation of trade preferences and 
the factors currently impeding the full use of the avai lable preferences.  In this regard, the following 
issues need to be addressed: (i ) the form and legal modalities need ed to impart stability to trade 
preferences granted under this initia tive; (ii) the identification of products where an expansion of 
product coverage would be required (obviously these products are the first candidates for a 
meaningful expansion of market a ccess for LDCs); (iii) the importance of rules of origin and other 
ancillary requirements in aff ecting the effective utilisation of  the preferences and how these 
requirements should be adapted in the light of the industrial capacity of LDCs; and possibly 
harmonised; and (iv) the need to provide LDCs with the necessary technical assistance aimed at 
increasing the utilisation of trade preferences. 
 Inama, S. (2003) Trade Preferences and the WTO Negotiations on Market Access. Journal of World Trade, Vol. 37(5), pp.  959-976. 
 
This paper aims at clarifying some conceptual issues on the value of trade preferences and aims at 
putting into focus future research on trade prefer ences.  The paper concludes three issues in the 
context of ongoing multilateral negotiations.  (i) Prefer ences "a la carte" and the enabling clause.  (ii) 
Rules of origin under unilateral trade preferences.  (iii) Graduation under GSP schemes.  Preferences 
"a la carte" are highly controversial among the developing countries.  They are also costly for the 
preferences giving countries.  Preferences, and even more, preferences "a la carte", could become the tool for a "stick or a carrot" exercise in the hand s of some preferences giving countries.  Seeking a 
multilateral agreement on graduati on for GSP schemes may prove to be impossible given the limited 
process on multilateral debates regarding special and di fferential treatment.  However, in the long run 
this option may provide stability to unilateral trade preferences.  Amid all of this, liberalization of 
rules of origin under unilateral tr ade preferences are almost ideal candidates for a win-win situation.  TN/MA/S/1/Rev.1 
Page 24  
 
This should be unanimously supported by all beneficiary countries.  Unfortunately ROOs are not a 
friendly object of negotiations given their complex nature.   
 Inama, S. (2004) Utilization of Trade Preferences. Mimeo. Geneva: UNCTAD.  
 
This paper assesses the value of trade prefer ences under the GSP schemes using non-traditional 
indicators.  An examination of the different benc hmarks yields the conclusion that there is a 
tremendous scope for improving the utilization of curre ntly available preferences in the GSP schemes.  
The persistent low trend of the u tilization rate holds for both LDC and non-LDC beneficiaries.  The 
paper further concludes that the inclusion or ex clusion of oil dramatically changes the picture 
preferences utilization.  One of the prime suspects fo r the underscored utilizati on of trade preferences, 
are the rules of origin.  Finally, the paper conclude s that beneficiaries countr ies with low utility rate 
and low utilization rates will be likely to experien ce little loss on trade dive rsion effects from the 
reduction of preferential margins since their trade is taking place under MFN.   
 
International Monetary Fund (2003) Financ ing of Losses from Preference Erosion, 
Communication prepared for the WTO,  WTO document code WT/TF/COH/14. 
 Losses from preference erosion, for LDCs as a whole, as a result of MFN tariff reductions by the 
Quad countries, will probably be ve ry small, likely less than two per cent of exports.  Only a few 
countries will face losses that are not insignificant.  But here too the magnitudes are small in absolute value and in relation to exports.  Only one country is expected to face losses exceeding ten per cent of exports.  Three key distinguishing features of losses from preference erosion are that they represent a 
permanent shock, they can be anticipated ex ante, an d that their actual impact is spread out over time. 
Given the limited number of countrie s that will be seriously affected and the distinguishing features of 
losses from preference erosion, any financing is be st done in the context of existing medium-term 
adjustment and program financing facilities.  In an y assessment of the balance of payments need in 
the context of program discussions, Fund staff should take into account the potential losses from 
preference erosion as one of the elements that affect the external environment facing a country's 
exports.   Kee, L.H., M. Olarreaga and P. Silva (2004) Market Access for Sale: Latin America's Lobbying 
for U.S. Tariff Preferences . World Bank Policy Research Working Paper No. 3198, 
Washington: World Bank. 
 This paper assesses the foreign lobbying forces behind the tariff preferences that the United States 
grants to Latin American and Caribbean countries.  Results suggest that returns to Latin American and 
Caribbean exporters lobbying for tariff preferences in the United States are around 50 per cent.  The 
reason for these large returns is the relatively low es timated weight given to social welfare in the U.S. 
government's objective function when deciding whether or not to grant tariff preferences to Latin 
American and Caribbean exporters.  Mattoo, A., D. Roy, and A. Subramanian (2003) The African Growth and Opportunity Act and 
Its Rules of Origin: Generosity Undermined ? World Bank Policy Research Working Paper No. 
2908, Washington, D.C.: World Bank. 
 This paper describes the Africa Growth and O pportunity Act (AGOA) which the United States 
recently enacted and assesses its quantitative impa ct on African exports. The AGOA expands the 
scope of preferential access of Africa's exports to the United States in key areas such as clothing.  
However, its medium- term benefits - estimated at about US$100-$140 million, an 8-11 per cent 
addition to current non-oil exports - would have been nearly five tim es greater (US$540 million) if no 
restrictive conditions had been imposed on the terms of market access.  The most important of these 
conditions are the rules of origin with which Africa n exporters of clothing must comply to benefit 
from duty- free access.  TN/MA/S/1/Rev.1 
 Page 25 
 
 
 
Michaely, M. (2004) Trade liberalization and trade preferences.  
 This text addresses two major issues of international trade policy: trade liberalization and preferential 
trade agreements - paying particular attention to th e inter-relationships of the two.  In doing so, 
Michaely raises timely new questions which he believes  to date have been neglected or insufficiently 
analysed.  The work combines a theoretical analys is, a development of instruments for both ex-ante 
and ex-post assessment of the impact of the polici es under review, and an application to particular 
experiences in the less-devel oped world over two decades. 
 
Olarreaga, M. and F. Ng (2002) Tariff Peaks and Preferences, in Hoekman, B., A. Mattoo, and 
P. English (eds) Development, Trade and the WTO: A Handbook, Washington, DC: World 
Bank.  
 This chapter provides a brief description of the extent and importance of existing tariff peaks in the Quad, the preferential treatment granted to developing countries for these tariff peak products, and the prevailing pattern of developing country exports.   The gains from prefer ential access are conditional 
on the ability to redirect and expand exports.  The benefits of preferential access are also heavily 
dependent on the extent to which other policies th at affect market access constrain exports from 
LDCs.  Rules of origin and the thre at of contingent protection are examples of policies that can be so 
used as to greatly reduce the value of duty-free access.  Rules of origin that require high levels of local value added can imply that developing countries are forced to pay the MFN tariff.  The threat of instruments of contingent protection can also reduce the incentive to undertake investments to benefit 
from duty- free access.  
 
Özden, Ç., and E. Reinhardt (2002) The Perversity of Preferences: GSP and  Developing 
Country Trade Policies, 1976-2000 . World Bank Policy Research Working Paper No. 2955, 
Washington: World Bank. 
 Industrial countries maintain spec ial tariff preferences, namely the Generalized System of Preferences 
(GSP), for imports from developing countries.  Critic s have highlighted the underachieving nature of 
such preferences, but developing countries continue to place the GSP at the heart of their agenda in 
multilateral negotiations.  What effect do such pref erences have on a recipi ent's own trade policies? 
Özden and Reinhardt develop and test a simple th eoretical model of a small country's trade policy 
choice, using a dataset of 154 developing countries from 1976 through 2000.  They find that countries 
removed from the GSP adopt more liberal trade polici es than those remaining eligible.  The results, 
corrected for endogeneity and robust to numerous a lternative measures of trade policy, suggest that 
developing countries may be best served by full in tegration into the reciprocity-based world trade 
regime rather than continued GSP-style special preferences.  
 Özden, Ç., and E. Reinhardt (2004) First Do No Harm: The Effect of Trade Preferences On 
Developing Country Exports . Mimeo. Atlanta, GA: Emory University. 
 
This paper analyze a panel of GSP recipients from 1976 to 2000 and find that their export 
performance improves after they are removed from the United States GSP program.  The results are 
robust to alternative export measures and to correc tion for endogeneity of GSP status.  They conclude 
that, even on their own terms, nonreciprocal prefer ence programs have failed.  Developing countries 
would be better served by full integration into the reciprocity-based world trade regime than by the prevailing form of nonreciprocal trade preferences. 
 TN/MA/S/1/Rev.1 
Page 26  
 
Özden, Ç., and G. Sharma (2004) Price Effects of Preferential Market Access: The Caribbean 
Basin Initiative and the Apparel Sector . World Bank Policy Research Working Paper No. 3244, 
Washington, DC: World Bank.  
 Özden and Sharma analyze the impact of the unilateral preferences granted by the U.S. Caribbean 
Basin Initiative (CBI) on the prices received by eligible apparel exporters.  The authors find that CBI 
exporters only capture around two-thirds of thei r preference margin, despite the fairly competitive 
nature of the apparel market.  This  translates into a 9 per cent incr ease in the relative prices they 
receive, but these numbers vary across countries and years.  Countries specializing in higher-value 
items capture more of the preference margin while implementation of the North American Free Trade Agreement has a negative effect.  The authors an alyze the effect of Multi-Fibre Agreement (MFA) 
quotas imposed on third countries (such as China) an d find that the benefits of CBI preferences will 
be significantly reduced once the quotas are fully removed in 2005.  Panagariya, A. (2002) EU Preferential Trade Arrangements and Developing Countries
. The 
World Economy, vol. 25(10), pp. 1415-1432. 
 
This paper offers an overview and quantitative as sessment of the EC PTAs  with the developing 
countries.  The main conclusion is that beyond the obvious rent transfers accompanying such 
preferences, a definite positive impact of these arra ngements on developing countries is difficult to 
detect.  To some degree, given the multi-layered Eu ropean arrangements, it is not entirely clear what 
these preferences have meant.  In deed, preferences to one set of developing countries have probably 
come at the expense of another.  The preferences may have also reduced pressures for trade 
liberalization within the preference receiving-co untries thereby undermining the internal policy 
reform that could have promoted faster expansion of trade and possibly growth.  
 
Romalis, J. (2003) Would Rich Country Trade Preferences Help Poor Countries Grow? 
Evidence from the Generalized System of Preferences.  Mimeo, Chicago: University of Chicago.  
 Would new trade preferences by the US, the Europ ean Union and other developed countries help the 
world's poorest countries grow? This paper concludes that they would.  It empirically examines this 
issue by studying the impact of the Generalized Sy stem of Preferences on the growth of developing 
countries.  In the 1970s most developed countries reduced or eliminated tariffs on thousands of 
products exported by most developing countries.  The extent to which countries benefited on impact 
from these tariff reductions varied with the intens ity of their trade with the developed world.  This 
paper finds that the growth rate of countries that received the largest tariff reductions accelerated relative to the growth rate of countries that benefi ted less.  But the highest trade barriers maintained 
by the developed world are still imposed on goods that  are disproportionately exported by the world's 
poorest countries.  This paper's results suggest that eliminating these barriers would significantly 
improve the prospects of some of the world's poorest people. 
 
Stevens, C. and J. Kennan (2003) Comparativ e Study of G8 Preferen tial Access Schemes. 
Interim Report, Brighton: Instit ute of Development Studies.  
 
This report provides some very preliminary find ing for Phase I of a comparison of preferential 
schemes offered by G8 to African exports.  Further, this report will set the scene for Phase II through 
identifying the preference agreements of most importance for Africa and their principal differences.  
EU has the widest range of goods and preferential agreements, no fewer than eight agreements apply 
to Africa.  The other G8 have, compared to EU, far fewer agreements.  The paper concludes several features that can effect the characteristics of the preference agreement.  These features are: 
geographical coverage, depth of preference, tariff quotas, duration, legal basis, and rules of origin.  
Further, the paper concludes a hypothesis that the value to Africa of G8 trade preferences could be 
enhanced through one or both of changes: (i) harmonization of exporters conditions (ii) improvement 
of specific provisions in some agreements.  Mo reover, the paper identifies which of the multiple  TN/MA/S/1/Rev.1 
 Page 27 
 
 
agreements, for the LDC and the sub Saharan African countries, are the most preferential and 
effectively therefore, the one normally being used.  A RoO comparisons are rather difficult since they 
have different systems.  A genuin e comparison between the G8 countr ies will have to wait the more 
country-/product-specific analyses.  However, the paper concludes that the EU and Canada have the 
most liberal rules followed by USA (except for th e case of clothing under AGOA) and Japan.  
 
Stevens, C. and J. Kennan (2004) The Utilization of EU Preferences to the ACP. Paper 
presented to the Technical Seminar on Tariff Preferences and their Utilization, WTO, Geneva, 
31 March 2004. Brighton: Inst itute of Development Studies. 
 
There are four main reasons wh y preferences might not be full y utilised, with very different 
implications.  This paper examines the extent of each of the four.  The data on whether or not EU 
imports from Africa are actually treated preferentiall y by customs are not good.  But what is available 
suggest that any failure to claim preferences is tr ivial.  Overwhelmingly the most important reason 
why EU imports from Africa do not receive preferences is that the items face duty- free Most 
Favoured Nation (MFN) access.  Over two -thirds of imports by value fall into this category.  
 
Topp, V. (2003) Are trade preferences helpful in advancing economic development ?  APSEG 
working papers No 03-5, Canberra: Australian National University. 
 This paper takes a closer look at how trade preferen ce schemes work and at their efficacy as a tool for 
providing development assistance.  Are trade prefer ences helpful in advancing economic development 
in poor countries and, even if they are, might ther e be other measures that would be more effective 
and efficient?  More precisely, the paper asks whether trade preferences to developing countries are 
consistent with the principles of effective aide set down by Stiglitz.  The conclusion is that there are 
serious underlying flaws and limitations in the existing schemes, and these problems should be 
addressed collectively. 
 United Nations Conference on Trade and Development (2001) Improving Market Access for Least Developed Countries, Geneva: UNCTAD. 
 Among the various initiatives undertaken at the mu ltilateral and internationa l level to favour LDC's 
exports, the European Union (EU) proposal, originally made in the course of the preparations for 
Seattle by providing LDGs duty/quota-free treatment for "essentially all" products, is probably one of 
the most relevant.  At present, the recently appr oved "Everything But Arms" (EBA) initiative is the 
most tangible implementation of such course of action.  The original proposal was discussed in several forums including at the World Trade Orga nization (WTO), where agreement was reached that 
duty/quota-free treatment would be "consistent with domestic requirements and international 
agreements".  The "essentially a ll" qualification of the offer may imply that some items would be 
excluded from the coverage of the initiative.  More over the use of the word "consistent" with the 
existing requirements may imply that current rules of origin and administrative procedures will not be 
modified.  The present paper contends that four ba sic conditions should be fulfilled by these various 
initiatives to improve market access for LDGs: (i) ensu re security of the preferential treatment granted 
(e.g. to establish a commitment that imparts stabilit y of market access to the initiative); (ii) provide 
full product coverage at duty-free rate, limited pr oducts exceptions may be granted duty-free tariff 
quotas with a scheduled phase down; (iii) harmonize and devise origin requirements matched with the 
industrial capacity of LDGs; and (iv) strengthen t echnical cooperation to maximize utilization of trade 
preferences.  Finally, this paper is limited to market  access constraints, in particular tariffs and issues 
related to rules of origin.  Supply-side constrai nts, determining LDGs' export capacity are not 
addressed, but should be taken into  consideration in the context of any initiative directed at improving 
LDGs' participation in global trade flows.   TN/MA/S/1/Rev.1 
Page 28  
 
United Nations Conference on Trade and Development (2003) Trade Preferences for LDCs: An 
Early Assessment of Benefits and Possible Improvements , UNCTAD/ITCD/TSB/2003/8, 
Geneva: UNCTAD. 
 
Unilateral tariff preferences in favour of developing  countries are usually regarded as a "second-best" 
arrangement that may also divide developing countri es.  There have also been efforts to improve the 
scope and operation of various schemes, notably the Generalized System of Preferences (GSP) and 
more recent initiatives such as the European Unio n´s "Everything But Arms" (EBA) scheme for least-
developed countries (LDCs) or the United States ´ African Growth and Opportunity Act (AGOA).  
 Using new data sources on a time series basis, this  study analyses, in some detail, past and present 
features of these preferential market access initiatives of the Quad countries.  The study concludes by 
recommending that, to be effective, trade preferences should be stable and cover all products with 
rules of origin and related administrative procedur es that reflect the supply capacity and industrial 
development of LDCs. 
 
United Nations Economic Commission for Africa (2004) Economic Report on Africa
, Addis-
Ababa: UNECA  
Chapter 2 looks at three areas of central concern to African policy makers: (a) the reasons for Africa's 
continuing marginaliz ation in world trade; (b) the potential impact of multilateral trade liberalization 
on Africa's agricultural sector; (c) the effects of trade reform on the reduction of poverty and income inequalities in Africa.  The chapter c oncludes that liberalization in itself is not a miracle cure and that 
trade must be liberalized cautiously.  Chapter 6 considers the fiscal implications of trade 
liberalization.  For African govern ments with inefficient tax administrations, and for those that still 
rely heavily on trade taxes, maintaining fiscal stab ility while liberalizing trade is a serious challenge.  
The chapter explains how the negative impacts of trade liberalization can be offset or reduced with 
appropriate policies. 
 
World Trade Organization (2004) World Trade Report 2004
, Geneva: World Trade 
Organization  
Section I.B.1 of the World Trade Report 2004 focuses on the current debate about the "development" 
value of preferences and their impact on the multila teral trading system.  The Section discusses the 
economics of preferences, the pattern of preferential arrangements and the implications of such 
arrangements for the multilateral trading system.  The evidence presented suggests that despite the 
proliferation of non-reciprocal pr eference schemes, questions rema in about their effectiveness in 
enhancing the industrialization and integration of de veloping countries into the trading system.  First, 
the degree of actual preferential access resulting from these schemes is limited.  Second, even in cases 
where preference margins are significant, utilization is  often significantly below potential.  Moreover, 
where meaningful preferences are granted, the degree of trade diversion is a concern for non-
preference receiving countries.  Preferences no l onger command general support among developing 
countries.  Finally, what preferences remain will st eadily be eroded by efforts to reduce MFN tariffs 
through successive rounds of multila teral negotiations, as well as by regional arrangements that cut 
across the existing patterns of preferences. 
 
 
IV. NON TARIFF MEASURES 
Anderson, J.E. and E. van Wincoop (2004) Trade costs
. Journal of Economic Literature, vol. 
42(3), pp. 691-751. 
 This paper is a survey of trade costs.  Trade costs are broadly defined as including all costs incurred in 
getting a good to a final user other than the marginal cost of producing the good itself: transportation  TN/MA/S/1/Rev.1 
 Page 29 
 
 
costs, policy barriers (tariff and non-tariff), informat ion costs, contract costs, enforcement costs, costs 
associated with the use of different currencies, legal and regulatory costs, and local distribution costs.  
The authors use three different approaches to evaluate trade costs.  They first review evidence on 
international policy barriers, transport costs and wholesale and retail distribution costs.  Second, they 
infer estimates of trade costs from trade flows using a gravity model.  Third, they use prices as an 
indirect source of information about the magnitude of trade costs.  Results suggest that trade costs are 
large and vary widely across countries and product lines.  Bradford, S. (2003) Non Tariff Barriers in Rich Econom ies: Quantifying Them, Identifying 
Them, and Assessing their Impacts , mimeo, Provo, UT: Brigham Young University 
 
This paper presents a new method for estimating tariff equivalents of NTBs for final goods in OECD 
economies. The analysis exploits detailed, comprehens ive, and careful price comparisons.  Since this 
method does not identify policies, the author st rives to supplement the numbers by presenting 
preliminary information on possible sources of the ba rriers.  The authors then use an applied general 
equilibrium model to provide a broad-brushed asse ssment of the impact of these NTBs.  The result 
imply that NTBs greatly restrict trade in OECD economies and that removing them would bring large 
gains to them and to developing countries.   Dee, P. and M. Ferrantino (eds) (forthcoming in 2005) Quantitative Methods for Assessing the 
Effects of Non Tariff Measures and Trade Fa cilitation, World Scientific Publishing Co. 
 
As tariffs have fallen worldwide, the increasing im portance of non-tariff policies for further trade 
liberalization has become widely recognized. The me thods for assessing the potential effects of such 
liberalization have lagged significantly behind those available for analyzing tariffs.  This book 
comprehensively addresses this gap.  It has been designed to be useful for both economists and 
policymakers, especially for those involved in co mmunicating ideas and results between economists 
and policymakers.  This book discusses the full range of methodologies used in this area, including 
business surveys, summary statistics such as effective rates of protection and price gaps, time-series 
and panel econometrics, and simulation methods such as computable general e quilibrium.  It covers 
the entire spectrum of polices under discussion in current trade negotiations, including trade 
facilitation, services policies, qua ntitative measures, customs proce dures, standards, movement of 
natural persons, and anti-dumping.  
 
Evenett, J. S. and B. Hoekman (2004) Government Procurement: Market Access, 
Transparency, and Multilateral Trade Rules . World Bank Policy Research Working Paper no 
3195. Washington, DC: World Bank.   This paper examines the effects on national welfare and market access of two public procurement practices, discrimination against foreign suppliers of goods and services and non-transparency of the 
procedures used to allocate government contracts to firms.  Both types of policies have become 
prominent in international trade negotiations, incl uding the Doha Round of WTO trade talks.  The 
analysis concludes that greater domestic co mpetition on procurement markets and greater 
transparency will improve economic welfare.  However, there is no clear-cut effect on market access 
of ending discrimination or improving transparency.  This mismatch between market access and 
welfare effects may account for the slower progress  in negotiating procurement disciplines in trade 
agreements than for traditional border  measures such as tariffs, given that market access is the driving 
force behind trade agreements. 
 
Francois, J. and I. Wooton (2004) Market Structure in Services and Market Access in Goods
. 
Tinbergen Institute Discussion Paper TI 2004-050/2, Rotterdam: Tinbergen Institute. 
 This paper examines the interaction between trade in goods and the degree of market power exercised by the domestic trade and distribution sectors, the ma rgin sectors.  The theoretical results point to an TN/MA/S/1/Rev.1 
Page 30  
 
expected linkage between service sector competition an d goods trade.  At least in theory, the domestic 
service sector can serve as an effective import barrier.  This is also supported by the econometric 
results.  These point to statistically significant li nkages between effective market access conditions for 
goods, and the structure of the service sector.  They  also point to a qualitatively significant effect.  
Because of the implied interaction, at least across  our sample of OECD countries, ignoring structure 
of the domestic service sector may lead to a substa ntial underestimation of the direct impact of tariffs 
on trade flows.   Hoekman, B., and K. Saggi (2004) Trading Market Access for Competition Policy Enforcement.
 
World Bank Policy Research Working Paper No. 3188. Washington, DC: World Bank.   
Motivated by discussions in the World Trade Orga nization (WTO) on multilateral disciplines with 
respect to competition law, this paper develops a two-country model that explores the incentives of a 
less developed country (LDC) to offer increased market  access (via a tariff reduction) in exchange for 
a ban on foreign export cartels by its developed country (DC) trading partner.  The authors show that 
such a bargain is feasible and can generate a globally welfare maximizing outcome.  They also explore the incentives for bilateral cooperation when  the LDC uses transfers to "pay" for competition 
enforcement by the DC.  A comparison of the two cases shows that there exist circumstances in which 
the stick (i.e. the tariff) is more effective in su staining bilateral cooperation than the carrot (i.e. the 
transfer).  Furthermore, the scope for cooperati on is maximized when both instruments are utilized.  
An implication of the analysis is that LDCs have in centives to not bind tariffs in the absence of an 
explicit WTO prohibition of export cartels.  
Organization for Economic Cooperation and Development (2003) Non Tariff Measures 
Affecting EU Exports: Evidence from a Complaints Inventory,  Official Document ECO/WKP 
(2003)27, Paris: OECD. 
 
This study reports evidence on the prevalence of NTMs based on an inventory of business complaints.  The results suggest that natural resource based indu stries, such as agriculture and food, mining, and 
textiles, are most strongly affected by NTMs re lative to their export volumes.  Certification 
procedures, quantity control measures, and tech nical regulations are the types of NTM most 
frequently complained about.  Complaints about do mestic governance practices, such as impediments 
related to government procurement, investment restri ctions, or insufficient intellectual property rights 
protection account for almost a third of all NTM observations and are in most cases not sector-
specific, but of a general nature.  These complaints  are frequently associated with discriminatory 
practices or inappropriate regulations, while dela ys and obstructions are repeatedly mentioned in 
relation to customs and certification pr ocedures and technical regulations.  
 
Organization for Economic Cooperation and Development (2004) Analysis of Non-Tariff 
Measures: The Case of Prohibitions and Quotas . Trade Policy Working Paper No. 6. Paris: 
OECD 
 
This study, that investigates two specific types of  quantitative restrictions, namely import prohibitions 
and quotas, is part of a broad reflection aimed at  learning more about the nature and scope of non-
tariff measures.  The analysis reviews information on these measures contained in the WTO Trade 
Policy Reviews, WTO notifications and in various other trade reports.  The research revealed that the 
use of quotas and prohibitions for economic reasons has declined, but most countries use prohibitions 
as part of their regulatory frameworks for protectin g human safety and health or the environment, and 
this tendency appears to be increasing.  Traders would benefit from greater transparency of these measures.  Also, there are import bans hampering the international trade in used goods, whose 
circumstances and appropriateness in terms of regulatory efficiency merit scrutiny. 
  TN/MA/S/1/Rev.1 
 Page 31 
 
 
Organization for Economic Cooperation and Development (2003) Overview of Non-Tariff 
Barriers: Findings From Existing Surveys . Paris: OECD.  
 This paper compiles and broadly analyses the findings  from survey-based research that helps identify 
barriers perceived by exporters from various countries  and regions in foreign markets.  It furthermore 
explores the extent to which different surveys re port the same types of barriers.  From the above 
review of survey-based research it is clear that businesses feel that numerous non-tariff barriers 
impact on their access to foreign markets.  The various business surveys provide a rich account of the 
types of constraints experienced by the exporting fi rms of a particular countr y or region.  The cross-
survey analysis highlights the global dimension of  obstacles where different surveys carried out in 
different parts of the world all report such obstacles as relatively often mentioned by respondents.  More specifically, some concerns from the business community appear to be widely shared across 
countries and regions.  
 
Organization for Economic Cooperation and Development (2003) Analysis of Non-Tariff 
Measures: The Case of Export Restrictions . Paris: OECD.  
 
This paper provides an overview of current disciplines on export restrictions under the GATT/WTO, 
including the scope of exceptions.  It also indica tes the current situation regarding the implementation 
of notification obligations concerning quantitative re strictions.  The main questions that this paper 
deals with include: the nature of justifications in voked for exceptions, in particular in the case of 
economic reasons; whether current transparency discip lines are sufficient in terms of predictability; 
and whether there is room for strengthening disciplines in this area, on either a horizontal or a sectoral 
basis. 
 
Organization for Economic Cooperation and Development (2002) Analysis of Non-Tariff 
Measures: The case of Non-Automatic Import Licensing . Paris: OECD.  
 Non-automatic licensing systems are a means to control imports, depending on compliance with 
specific criteria. These schemes can be applied fo r a variety of purposes, according to both economic 
and non-economic regulatory goals.  The use of these measures has been evolving over time, and with 
the significant reforms that have been undertaken over the years, the pattern of perceived problems 
associated with them has changed.  The analysis in the present report reviews and summarises on a 
country basis the information contained in the WTO Trade Policy Reviews (TPRs), which generally 
permit identification of licensing measures used in  different countries and the broad product groups 
covered.  In addition, the analysis draws on th e on-going discussions at the WTO on trade facilitation, 
particularly highlighting the important link with  import licensing.  Import licensing schemes 
implemented for economic reasons have the primary intent of limiting imports to protect domestic 
producers, thus having similar effects as import quotas.  In WTO Member countries, the use of these 
measures has largely been discontinued.  By contra st, import licensing implementing a wide variety of 
regulations related inter alia  to national security, protection of health, safety, and the environment, is 
widely used across both OECD and non-OECD countrie s.  It is with respect to the procedural aspects 
that the question of trade impact of such licens ing for non-economic reasons  arises.  Although the 
WTO provides far-reaching disciplines in the area of  licensing procedures, particularly through the 
Agreement on Import Licensing (ILP), business concer ns suggest that trader s are still experiencing 
problems with the way in which licensing systems ar e implemented and applied.  Besides the need to 
fully implement existing commitments, there appear to be areas where further improvement of 
licensing-related disciplines might be warranted.  This explains why licensing has been among the issue areas of the on-going WTO discussions on trade facilitation.    TN/MA/S/1/Rev.1 
Page 32  
 
Organization for Economic Cooperation and Development (2003) Analysis of Non-Tariff 
Measures: The Case of Export Duties . Paris: OECD.  
 WTO disciplines on export duties are not clearly defined and currently no Member assumes 
obligations for scheduling and notification of export duties under the WTO.  Meanwhile, it may be 
noted that more and more bilateral and regional tr ade agreements introduce disciplines to prohibit 
export duties and that the recent WTO accession process has led to certain concessions in this regard.  
This survey paper begins by clarifying the definiti on of export duties.  Then it examines existing 
disciplines on export duties in the WTO in detail.  It also examines curren t trends with respect to 
disciplines at the regional level and in the WTO accession process.  Finally, it analyses factual information on products subject to such duties ba sed upon Trade Policy Review reports and describes 
key findings from them, including trade and economic implications to the extent possible.  Certain 
trends concerning the use of export duties can be id entified from a review of the WTO's  Trade Policy 
Review country reports.  These are inter alia: Export duties are introduced mainly by developing and 
least developed countries; Outstanding examples of items subject to export duties are forestry 
products, fishery products, mineral and metal products, leather and hide and skin products, and various agricultural products; The two main reasons for imposing export duties are 1) fiscal receipts 
or revenue and 2) promotion of downstream processing industries; Another alleged reason is 
environmental protection or preservation of na tural resources or products; There is a growing 
tendency to abolish export duties notably in bilate ral and regional contexts, reflecting a recognition of 
their trade distortive effects.  Detailed explanati ons of these issues and other outstanding points are 
described in this paper.  
Observations are also included on aspects of possible rule-making on export duties in the context of 
the on-going process of the Doha Development Agenda.  Finally, the suggestion is put forward that it 
would be useful to undertake a wider analysis of export restrictions under the NTM project, as a 
further background contribution to the DDA. 
 Piermartini, R. (2004) The Role of Export Taxes in the Field of Primary Commodities, 
 
WTO Discussion Paper No. 4 , Geneva: WTO. 
 
This paper examines the economic effects of an e xport tax on commodity prices and the volume of 
exports.  It examines how welfare resulting from an export tax is redistributed among foreign and 
domestic consumers, producers and the government, and the effects of an export tax used as an 
instrument of trade policy to improve developi ng countries' terms of trade, favours economic 
diversification and help the poor.  
Sharma, Rajeev (2002) WTO beware: the newest gl obal non-tariff barriers.  International trade 
law and regulation Vol. 8(1), pp. 1-4. 
 
This paper focuses on recent calls by the EU to codify the precautionary principle in to the 
GATT/WTO acquisition and warns of its protectionist character.  Such proposals are not only 
unnecessary given existing WTO rules and decisions, they will do nothing to further the development 
of poorer countries.  The developing world desperately needs to participate in the benefits that open 
trade has to offer and such proposals will serve only to alienate an already disenfranchised part of the 
global economy. 
 
_________