|_Transparency_|4|9|3||13|3|8|6|3|10|7|4|5|1|||**76**|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|_Substantive commitments_|17|19|13||59|3|6|2|19|20|4|3|8|11|27|20<br>12|**243**|
|_Liberalization/Integration_|_14_|_8_|_11_||_19_||_4_|_1_|_3_|_4_|_3_|||||_13_|**_80_**|
|_Conditions/Obligations_|_3_|_11_|_2_||_40_|_3_|_2_|_1_|_16_|_16_|_1_|_3_|_8_|_11_|_27_|_7_<br>_12_|**_163_**|
|_Procedural requirements_|17|8|||12|3|28|10||3|28||2|2||17|**130**|
|_Enforcement mechanism_||1|3|8|22|1||2|4||5|7|5||4|1|**63**|
|_Sectoral coverage_|2|1|2||5||||||33|9|8||||**60**|
|_Specific coverage_||2|1|13||9|||||8|2|8|1|||**44**|
|_Exceptions_|5|6|2|35|4|4||||||3|1|3|||**63**|
|_Safeguards_||1|10|31||1|||||||||||**43**|
|_Special and differentiated treatment_|||||||||||7|2|2||||**11**|
|_Institutional framework_||1|1||2|2|2|6|2|11||||2|1|2|**32**|
|_Cooperation_|||2||3|1|8||3|3|1|1|1|5|4|1|**33**|
|_Miscellaneous_|||9|||||||6|5|2|2|||1|**25**|
|**_Totalprovisions_**|**46**|**64**|**57**|**95**|**120**|**30**|**52**|**51**|**34**|**59**|**100**|**36**|**54**|**35**|**48**|**38**<br>**18**|**937**|

Source: Authors’ calculations based on Mattoo et al. (2020).

We also make an effort to identify the set of provisions within each policy area that are essential to achieve the objectives of the agreement. The provisions we refer to as “essential” comprise the set of substantive provisions plus the disciplines among procedures, transparency, enforcement or objectives, which are viewed as indispensable and complementary to achieving the substantive commitments. Non-essential provisions are referred to as “corollary.” A caveat is that this exercise is based on the experts’ knowledge and, hence, is subjective. However, this approach has the advantage of limiting the dimensionality of the data in an informed way.<sup>13</sup>

# 3. Stylized facts

A number of new stylized facts emerge from a preliminary analysis of the data. Each of the chapters in the Handbook provides a first look at the data by policy area. In this paper, we present a bird’s-eye view of the entire data set put together by the experts. Given the differences among policy areas and among provisions within each policy area, this approach presents many quantification challenges, which are discussed below. In this section, we rely on simple counts of the provisions and on coverage ratios<sup>14</sup> to investigate the evolution of the content of deep trade agreements. The underlying assumption in this approach is that deeper trade agreements imply a larger number of provisions.

As shown in Espitia et al. (2019), liberalization in PTAs has reduced trade-weighted average tariff rates to less than 5 percent for more than two-thirds of countries (Figure O4). While there are still pockets of high protection in some countries, most notably lower-income economies, PTAs have been broadly successful in committing national governments to maintaining low tariffs. Trade-weighted applied tariffs are, on average, 2.3 percentage points lower than average most-favored nation (MFN) rates, with gaps of greater than 6 percentage points for countries like Tunisia, Morocco, Bosnia and Herzegovina, Namibia and Lao PDR. So, while from an efficiency perspective, preferential tariff liberalization is inferior to nonpreferential liberalization, the commitments countries have taken in the network of preferential trade

> 13 A statistical approach on how to assess the importance of specific provisions included in the different policy areas in explaining trade outcomes is presented in section 4.

> 14 The coverage ratio is defined as the share of provisions for a policy area contained in a given agreement relative to the maximum number of provisions in that policy area or agreement.

9