vices (Hoekman, 1990).<sup>2</sup> This realization helped to overcome some of the early resistance by developing countries to launching negotiations on trade in services and the creation of the WTO General Agreement on Trade in Services (GATS) in 1994. Building on the early analysis inspired by the Uruguay Round, there is now a growing CGE literature on market access in services.<sup>3</sup> For services, market access can be difficult to define. In practice it is often hard to judge just how open a particular nation is to foreign participation because explicit (discriminary) barriers will be complemented by domestic regulation, standards and business practices. For this reason, improved market access - as market opening is known in WTO jargon - has tended to be qualitative as opposed to quantitative (e.g., an X percent reduction in a tax-equivalent). In the case of trade in goods the focus of negotiators is on tariffs and non-tariff barriers (quotas, etc.). For analysts, these are relatively straightforward to model, as tariffs can be incorporated directly into models, and non-tariff barriers can be converted into tariff equivalents. In the case of services there is much less scope for negotiators – to target numeric measures of policy per se e.g., the analogue of a 10 percent reduction in tariffs. The focus of policymakers has instead been on qualitative commitments regarding specific policies that affect the cross-border movement of consumers and providers of services, or the establishment of foreign providers in a market, and to agree to disciplines on the use of measures that explicitly discriminate against foreign suppliers of services.

There is an inconsistency between the basic or balance of payments definition of trade, and the legal definition of trade enshrined in the WTO’s General Agreement on Trade in Services. Under the GATS, four ”modes of supply” are defined through which trade can occur. These include foreign direct investment (FDI) and temporary cross-border movement of suppliers. As a result there is a tension between how trade in services has come to be defined in policy circles and how trade is defined in the national accounts and balance of payments, which does not consider movement of factors of production as international trade per se.<sup>4</sup> In this paper, we examine how the recent multi-country CGE literature has moved from goods trade into quantification of market access in services. This includes both a discussion of measuring barriers to trade and investment (generally with a mix of firm surveys, price comparisons, and econometrics), and a discus-

> 2The revealed comparative index is a measure of relative specialization, defined as the share in total exports of a country of a given product, divided by the same ratio for the world as a whole. If this measure is greater than one a country is said to have a revealed comparative advantage in the product. The concept was first defined and used in Balassa (1965).

> 3See WTO (1998) for a survey of the early literature in this area.

> 4See Stern and Hoekman (1987), Francois (1990c) and Francois and Hoekman (2010) for further discussion. In practice market access negotiations in services involve a mix of rules on FDI, movement of persons, and cross-border commerce, and thus analysis and models must consider these various modes of supply.

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