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Are different Rules of Origin equally costly? Estimates from NAFTA

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Published in Cadot, O. & Estevadeordal, A. & Suwa-Eisenmann, A. & Verdier, T. The Origin of Goods: Rules of Origin in Regional Trade Agreements. Oxford: Oxford University Press. 2006, p. 191-212
Abstract Using data on the preference and utilization rates of NAFTA for Mexican exports to the United States in 2001, this chapter proposes a method to estimate the likely costs of different Rules of Origin (ROO) for final and intermediate goods, and compares these results with those obtained using the synthetic index proposed by Estevadeordal (2000). Econometric results indicate that changes in tariff classification are more costly for final goods than for intermediate ones, and that technical requirements are the most constraining. For activities subject to regional value content minima, illustrative simulations are carried out to indicate what tariff preference margin would be necessary to compensate for the import content minima. Cost estimates suggest that, at least in the case of NAFTA, preferential market access is quite small, leading to speculations that these conclusions may carry over to other North-South preferential schemes.
Keywords NAFTAPreference ratesUtilization ratesRules of originFinal goodsIntermediate goods
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ISBN: 9780199290482
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CARRERE, Céline, DE MELO, Jaime. Are different Rules of Origin equally costly? Estimates from NAFTA. In: Cadot, O. & Estevadeordal, A. & Suwa-Eisenmann, A. & Verdier, T. (Ed.). The Origin of Goods: Rules of Origin in Regional Trade Agreements. Oxford : Oxford University Press, 2006. p. 191-212. https://archive-ouverte.unige.ch/unige:46662

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Deposited on : 2015-02-14

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