The Effect of Product Standards on Agricultural Exports

We introduce a standards restrictiveness index to analyze the impact that food safety standards have on international exports of agricultural products. Our new measure of standards restrictiveness is created using maximum residue levels of pesticides for 61 importing countries and 66 different produ...

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Bibliographic Details
Main Authors:	Ferro, Esteban, Otsuki, Tsunehiro, Wilson, John S.
Format:	Journal Article
Language:	en_US
Published:	Elsevier 2014
Subjects:	Standards Agriculture International trade Emerging markets
Online Access:	http://hdl.handle.net/10986/20720

id	okr-10986-20720
recordtype	oai_dc
spelling	okr-10986-207202021-04-23T14:03:59Z The Effect of Product Standards on Agricultural Exports Ferro, Esteban Otsuki, Tsunehiro Wilson, John S. Standards Agriculture International trade Emerging markets We introduce a standards restrictiveness index to analyze the impact that food safety standards have on international exports of agricultural products. Our new measure of standards restrictiveness is created using maximum residue levels of pesticides for 61 importing countries and 66 different products. The index accounts for both the number of pesticides regulated for each product and the allowable level for those pesticides by each importer. The findings suggest that more restrictive standards are associated, on average, with a lower probability of observing trade. However, after controlling for sample selection and the proportion of exporting firms in a gravity model, the analysis finds that the effect of standards on trade intensity in most cases is indistinguishable from zero. This is consistent with the assumption that meeting stringent standards increases primarily the fixed cost to export to a destination. Once a firm adjusts its production to comply with the standards of a foreign market, those standards do not impact the intensity of exports to that market. Finally, our results suggest that exports from developing countries are particularly constrained by stricter standards. 2014-12-16T15:29:03Z 2014-12-16T15:29:03Z 2015-01 Journal Article Food Policy 0306-9192 http://hdl.handle.net/10986/20720 en_US CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Elsevier Publications & Research :: Journal Article
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	en_US
topic	Standards Agriculture International trade Emerging markets
spellingShingle	Standards Agriculture International trade Emerging markets Ferro, Esteban Otsuki, Tsunehiro Wilson, John S. The Effect of Product Standards on Agricultural Exports
description	We introduce a standards restrictiveness index to analyze the impact that food safety standards have on international exports of agricultural products. Our new measure of standards restrictiveness is created using maximum residue levels of pesticides for 61 importing countries and 66 different products. The index accounts for both the number of pesticides regulated for each product and the allowable level for those pesticides by each importer. The findings suggest that more restrictive standards are associated, on average, with a lower probability of observing trade. However, after controlling for sample selection and the proportion of exporting firms in a gravity model, the analysis finds that the effect of standards on trade intensity in most cases is indistinguishable from zero. This is consistent with the assumption that meeting stringent standards increases primarily the fixed cost to export to a destination. Once a firm adjusts its production to comply with the standards of a foreign market, those standards do not impact the intensity of exports to that market. Finally, our results suggest that exports from developing countries are particularly constrained by stricter standards.
format	Journal Article
author	Ferro, Esteban Otsuki, Tsunehiro Wilson, John S.
author_facet	Ferro, Esteban Otsuki, Tsunehiro Wilson, John S.
author_sort	Ferro, Esteban
title	The Effect of Product Standards on Agricultural Exports
title_short	The Effect of Product Standards on Agricultural Exports
title_full	The Effect of Product Standards on Agricultural Exports
title_fullStr	The Effect of Product Standards on Agricultural Exports
title_full_unstemmed	The Effect of Product Standards on Agricultural Exports
title_sort	effect of product standards on agricultural exports
publisher	Elsevier
publishDate	2014
url	http://hdl.handle.net/10986/20720
_version_	1764447051172544512

The Effect of Product Standards on Agricultural Exports

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