# **4. Avenues for future research based on these data**

As mentioned, the primary purpose of this paper is to raise awareness of the COVID-19 trade policy data set and encourage its use. In this section we briefly sketch out possible research questions that are suggested by the patterns we observe in the data.

## **_4.1 Policy choice_**

A first set of research questions centers around understanding the motives underlying choices in the design and implementation of trade policy responses to the pandemic, reflected in the substantial crosscountry heterogeneity observed in the data. These include the timing, the duration, and the use of different instruments. Potential explanatory variables include mechanisms pertaining to the medical, the economic and the political spheres, e.g., public health parameters of the COVID-19 pandemic; features of the pre-crisis trade and trade policy structures, such as trade dependency, GVC participation and positioning; degree of existing protection; integration in multilateral or plurilateral trade policy initiatives; the political forces determining the quality of government action etc. An important corollary exercise would be to test whether and how such empirical relationships vary between the food and the medical sectors and potentially between more disaggregated product-level categories.

Herding effects could be considered as well, calling into question whether individual observed policy choice is independent of the choices of others. Another source of interdependence across policy choices arises from membership of regional trade agreements. In this regard, the role that the European Commission played in replacing and then reining back the export controls imposed initially by Member States of the European Union is worthy of further study.

Econometric analyses could be complemented by some well-chosen country case studies. For instance, the Indonesian government started by exhorting local producers not to sell masks abroad. Then, Jakarta imposed an export limit or share. When that did not ‘work’ they banned exports of masks. This sequence of policy steps is different than jumping in with an export ban in the first place, reflecting, potentially, different political economy factors. Another example of potentially interesting countryspecific case study relates to Vietnamese export controls on rice. The government initially banned exports, but then the Prime Minister progressively watered down and abandoned the export controls. News reports suggest that opposition from rice farmers was important, but did other factors play a part in this policy reversal?

An example of research in this vein concerns the relationship between recourse to export controls and actions to facilitate imports. Do governments imposing export restrictions also act on the import side? Insofar as governments are expected to use both types of policy measures to maximize local access, we can examine whether there is more liberalization on the import side conditional upon imposing export restrictions estimating an equation as follows: I l l l l l l l (1) jj jj jj jj where I lII ll l l l l and = exp(αα+ ββEE lII l are the logarithm of 1 plus the number of import rrl llrrl rr + γγ′ZZ ) + εε liberalizations and export restrictions, respectively, implemented by jurisdiction ; is a vector of jj jj control variables; II l is a constant and II l the error term. The results from estimating equation (1) using rrl llrrl rr jj the Poisson Pseudo Maximum Likelihood Estimator, reported in Table 5, suggest that conditional upon jj ZZ jj having imposed export restrictions on medical products, there is more liberalization on the import side αα εε (the coefficient on export restrictions is statistically significant at 1%). Ceteris paribus and on average, a 10% rise in the number of export restrictions is found to be associated with a 5% increase in the number of import liberalization measures in these results. This is consistent with a prior that countries using trade policy instruments in response to the crisis will do so by targeting both the import and export margin of trade.

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