Assessing the Potential Benefit of Trade Facilitation: A Global Perspective

By John S. Wilson, Catherine L. Mann, T. Otsuki. 2004

262 citations recorded by the source corpus.

The relationships between trade facilitation, trade flows, and capacity building are complex and challenging to assess, both empirically and in implementation. The authors measure and estimate the relationship between trade facilitation and trade flows across 75 countries in global trade, considering four important categories: port efficiency, customs environment, regulatory environment, and service sector infrastructure. A gravity model is employed that accounts for bilateral trade flows in manufactured goods in 2000-01 between the 75 countries, using traditional factors such as GDP, distance, language, and trade areas, and is augmented by the trade facilitation measures in the four categories for each country. The results suggest that both imports and exports for a country and for the world will increase with improvements in these trade facilitation measures. Potential gains from trade facilitation reforms are predicted by using the estimated parameters. The gains from trade facilitation are presented by comparing the gains across geographical regions and trade facilitation categories, and by domestic and partner improvements. The total gain in trade flow in manufacturing goods from trade facilitation improvements in all the four areas is estimated to be $377 billion. All regions gain in imports and exports. Most regions gain more in terms of exports than imports, in large part through increasing exports to the OECD market. The most important ingredient in getting these gains, particularly to the OECD market, is the country's own trade facilitation efforts. The detailed presentation of the results of the analysis may help inform policy decisions and capacity building choices.

Subfields: Development, Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/f38200df04d1b92f3376b4c52e05b439c79386af

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Development

In Economics and Econometrics

Citations in the corpus

Institutions, Infrastructure, and Trade (2007, background): “Wilson et al (2004) have quantified the effects of trade facilitation by considering four aspects of trade facilitation effort: ports, customs, regulations, and e-business (which is a proxy for the service sectors of telecommunications and financial intermediation, which are key for all types of…”
A Dea-Logistics Performance Index (2017, background): “Wilson et al. (2005) define trade facilitation using four indicators: port efficiency, customs, regulations and use of e-commerce.”
Aid-for-trade facilitation (2009, unknown): “6 Gravity models incorporating border and behind-the-border trade facilitation measures, including Wilson et al. (2003, 2005), Engman (2005), Francois and Manchin (2007).”
Quantifying the Trade and Economic Effects of Non-Tariff Measures (2006, methodology): “For example, Wilson, Mann, and Otsuki (2005) consider four measures of policy quality relevant to trade facilitation: port efficiency, the customs environment, the regulatory environment, and service sector infrastructure.”
Regional Cooperation and Bilateral Trade Flows: An Empirical Measurement of Resistance (2007, background): “Furthermore, large government size (Rodrik, 1998), weak and inefficient institutions in home country (Wilson, Mann, and Otsuki, 2004; Levchenko, 2004), and political influences (Gawande and Krishna, 2001) have been identified to constrain trade flows between countries.”
Estimating the effects of non‐discriminatory trade policies within structural gravity models (2017, unknown): “…trade effects of MFN tariffs (see, for example, Augier et al. 2005) as well as to the literature concerning trade facilitation (for examples, see Wilson et al. 2005, Martinez-Zarzoso and Márquez-Ramos 2008, Djankov et al. 2010) by allowing for estimation of the effects of such policies directly…”
The Impact of Logistics Performance on Trade (2013, methodology): “Wilson et al. (2004) use a gravity model applied to trade across 75 countries in 2000 – 2001 to study the effects of the following four categories of logistics performance: port efﬁciency, the customs environment, the regulatory environment, and the service sector infrastructure.”
Assessing the impact of infrastructure quality on firm productivity in Africa: cross-country comparisons based on investment climate surveys from 1999 to 2005 (2010, background): “Wilson et al. (2004) consider ports, customs, regulations, and e-businesses as proxies of trade-facilitation efforts, finding that the scope and benefit of unilateral trade-facilitation reforms are very large, and that the gains fall disproportionately to exports.”