WORLD TRADE  
ORGANIZATION  TN/AG/S/23 
22 May 2006 
 (06-2480) 
Committee on Agriculture 
Special Session  
 
 
 
ANNOTATED SELECTIVE BIBLIOGRAPHY OF RECENT RESEARCH  
ON TARIFF ESCALATION 
 
Note by the Secretariat1 
 
  The attached annotated bibliography of rese arch on tariff escalation provides links to the 
documents in electronic format when possible.  All documents whose title is underlined can be 
accessed online from inside  the Centre William Rappard by hol ding the CTRL key while clicking on 
the underlined text.  Based on this bibliography, th e WTO Library has also created within the Library 
database an online tariff escalation bibliography.  Note that online document access from outside the 
WTO headquarters will be restricted to those doc uments that are freely av ailable on the Internet 
without subscription. 
  
                                                     
 
1 This document has been prepared under the Secret ariat's own responsibility and is without prejudice 
to the positions of Members or to their rights or obligations under the WTO. TN/AG/S/23 
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  Clark, D. and D. Bruce (2006)  On the Incidence of US Tariffs
.  The World Economy, Vo. 29(2), 
pp. 123-135. 
 
 This paper describes the incidence of tariffs  on products of export interest to developing 
countries by investigating the relationship between per capita incomes of US trading partners and 
tariff rates.  It assesses the incidence of tariffs imposed by the US across countries with differing per 
capita incomes.  Average tariff rates are lower for the poorest and richest countries and higher for 
countries in the middle of the income distribution.  This finding contradicts the widely held view that 
tariffs used by industrial nations have a greater  impact on products of export interest to poorer 
developing countries than on imports from industrial na tions.  It is consistent with the tariff escalation 
pattern reported in earlier studies if advanced count ries account for most products at the end of the 
processing chain.  Results show that poor countries will find it difficult to escape tariffs by attaining 
higher levels of ec onomic development. 
 
De Cordoba, F., S. Laird, and D. Vanzetti (2004)  Trick or Treat?  Development Opportunities 
and Challenges in the WTO Negotiations on Industrial Tariffs .  Center for Research in 
Economic Development and International Trade research paper 04/03. 
 
 Industrial tariffs could reduce protection on de veloping country exports however the total 
impact of tariff reduction is unclear.  While the more ambitious proposals could lead to greater 
exports and welfare gains (and hen ce make a greater contribution to poverty reduction overall), these 
gains are not evenly spread acro ss countries or sectors.  Moreover, the main proposal does not fully 
resolve problems of tariff escalation and peaks.  The more ambitious proposals also imply greater imports, lower revenues, some labour market adju stments and reduced output, threatening key sectors 
in some developing regions.  Proposals that take greater account of the need for special and differential treatment for developing countries seem  less threatening, but also bring fewer export 
opportunities and welfare gains.  A mechanism to assi st developing countries in coping with the likely 
adjustment, then the negotiations could help ach ieve the development objectives of this round. 
 
Francois, J. and W. Martin (2003) Formula A pproaches for Market Access Negotiations. World 
Economy, vol. 26(1), pp. 1-28.  
  Most of the large tariff reductions achieved in multilateral trade negotiations have involved 
tariff–cutting formulas such as the "Swiss" formula.  However, wide variations in initial tariff rates 
between active participants call for new approach es under the Doha Development Agenda.  This 
paper surveys a range of formula options and examines  both targeted and flexible applications of the 
Swiss formula that target tariff escalation and p eaks.  These options would allow policy makers 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 lower–tariff sectors.  
Geithner, T. and G. Nankani (2002) Market Access for Developing Countries Exports – Selected 
Issues . Paper prepared by the Staffs of the IM F 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 multilateral trading system.  It suggests that priority should 
be given to phasing out tariff peaks and escalation, to tightening disciplines on trade remedy laws, and 
to addressing the needs of developing countries in meeting proliferating product standards and 
regulations.  It also endorses the extension of co mprehensive duty- and quota-free access for exports 
from LDCs to all industrial country markets.  Si nce agricultural markets are among the most heavily 
distorted, liberalization in both industrial and de veloping countries is likely to have long-term, 
dynamic effects on developing country production and trade.  
  TN/AG/S/23 
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  As in the case of agriculture the efficiency gain s from liberalization of trade in this sector 
would likely be significant for developing and industria l countries alike.  At the same time though, the 
removal of quota restrictions, already agreed unde r the Uruguay Round and set to be completed by 
2005, may cause shifts in competitivene ss.  These shifts, at least in the near term, affect the balance of 
payments positions of those exporte rs whose market access is effectively protected by the current 
system. 
 
Guha-Khasnobis, B. (2004) Who Gains From Tariff Escalation ? Journal of Economic 
Integration, vol. 19(2), pp. 416-425. 
  Using a simple model of production and trade, th is paper examines the differential impact of 
tariff escalation on skilled and unskilled wages in an economy.  The analysis captures the effects of 
lobbying on the prevalence of tariff escalation in deve loped countries.  The model also predicts the 
developing country response to tariff escalation a nd shows that, in contrast to the results for 
developed countries, lobbying activity  in developing countries can slow the pace of liberalization of 
service sector trade.  The analysis concludes that skilled labour and capital owners are likely to gain 
from lobbying and postulates that this is because these two groups have greater lobbying power than 
unskilled labour.  Therefore, governments of de veloped countries may feel pressured to preserve 
differential rates of protection between stages of  production due to lobbying by skilled labour and 
capital owners.  If skilled labour groups are equally influential in developi ng countries, the model 
predicts that liberalization of the service sector s in these countries may be slow and difficult.  
 
Michalopoulos, C.  (1999)  Trade Policy and Market Access Issues for Developing Countries:  
Implications for the Millennium Round .  World Bank Policy Research Working Paper No. 
2214, Washington, DC:  the World Bank. 
  The author analyzes 61 trade policy review s prepared for the World Trade Organization 
(WTO) and its predecessor, GATT - reviews that document the progress developing countries have made in integration with the world trading system over the past decade.  Based on an analysis of post-
Uruguay Round tariff and non-tariff barriers worldwid e, he then recommends developing country 
positions on Agriculture, Manufacturing and Anti-dump ing in WTO trade negotiations.  With respect 
to manufacturing, he notes that the existence of tariff peaks and escalation in industrial country 
markets and the limited bindings at relatively high levels of developing country tariffs on 
manufactures present opportunities for negotiations with good prospects for shared and balanced 
benefits.  The remaining non-tariff barriers in industrial countries that affect manufactures are 
concentrated in textiles and clothing.  Developi ng countries should ensure that industrial countries 
implement their commitments to liberalize this sector and impose no new non-tariff barriers in this or 
other sectors under the guise of other rules or arrangements.  The remaining non-tariff barriers in 
developing countries should be converted into tariffs and reduced over time as part of the 
negotiations.  
OECD (1999)  Post-Uruguay Round Tariff Re gimes.  Achievements and Outlook.  
Paris: OECD. 
 
 This book provides trade negotiators with a tool that will help them formulate their negotiating objectives and strategies in the area of tari ffs.  It provides policy analysts with data which 
could be used to define negotiating scenarios and to impute the corresponding impact on trade, 
employment and growth.  The study addresses th e issue of tariff escalation using two different 
methodologies.  The first identifies the appropriate  stage of processing for each of the 5113 product 
classifications.  The methodology, which was devise d by the GATT secretariat in 1980 allows one to 
observe whether or not there is  an overall escalation of tariffs.  The second methodology calculates 
mean tariff levels at each of three stages of processing for 13 agricultural and industrial product 
chains, including bovine meat, cocoa, coffee, cott on, soybeans, sugar, tobacco, wheat and wood.   TN/AG/S/23 
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Tsigas, M.  (2001)  How would Food Markets be Affected by Liberalizing Trade in Processed 
Foods .  United States International Trade Commission Working Paper No. 2001-08-A,  
Washington DC:  US ITC. 
  The paper discusses some of the implications of liberalizing trade in processed foods in the 
context of the upcoming WTO trade negotiations.  Simulated impacts suggest that a 30 per cent 
reduction in farm and food tariffs  would benefit US farming in terms of output, net exports and 
income.  The US processed food sector would decl ine, but net exports of processed foods would 
increase.  A 30 per cent reduction in farm tariffs c oupled with tariff de-escalation in farm-processed 
foods trade would strengthen the US farm economy as  well as net exports of processed foods.   The 
US processed foods sector would gain the most when a 30 per cent reduction in farm tariffs is coupled 
with elimination of tariff escalation in farm-processed foods trade.    
 
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