OECD Food, Agriculture and Fisheries Papers

ISSN :
1815-6797 (online)
DOI :
10.1787/18156797
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Selected studies on various food, agriculture and fisheries issues from the OECD Trade and Agriculture Directorate.

NB. No. 1 to No. 58 were released under the previous series title OECD Food, Agriculture and Fisheries Working Papers.

 

The Impact of Regional Trade Agreements on Trade in Agricultural Products You or your institution have access to this content

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Author(s):
Jean Christophe Bureau1, Sebastien Jean2
Author Affiliations
  • 1: AgroParisTech, France

  • 2: Institut national de la recherche agronomique, France

Publication Date
09 Oct 2013
Bibliographic information
No.:
65
Pages
32
DOI
10.1787/5k3xznkz60vk-en

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Trade flows are significantly affected by the trade agreements both with respect to impacts on pre-existing trade flows, (intensive margin) and on new, previously non-existent trade flows (extensive margin). The effect of the Regional Trade Agreements on pre-existing trade flows are found to be significant with a mean elasticity of substitution at the product level of about 2 so that a 1% preferential margin increases trade by only 2% on average. Total bilateral exports are found to be increased by 18% on average for products benefiting from a preferential margin between 5 and 10%, and by 48% for products where the margin exceeds 10%. The effect of an RTA agreement on extensive margin is to increase the probability to export a given a product to a partner country by one percentage point on average. Furthermore preferential margins, as measured through their impact on tax-inclusive consumer prices, nearly double within eight years of entry into force rising from 4.7% to 8.9% on average.
Keywords:
regional trade agreements, agricultural trade, preferential margins, extensive and intensive margins, econometric estimates