Year of Publication

2007

Document Type

Dissertation

College

Agriculture

Department

Agricultural Economics

First Advisor

Michael R. Reed

Abstract

The impact of domestic policy regulations and standards on trade has been at the forefront of global policy during the past decade. Every country develops their own policies and standards that differ from country to country. These differences create problems for manufacturing industries, especially in major exporting countries. This study overviews the policy context driving standards in the manufacturing industries. The study consists of three different articles that attempt to examine the role of technical regulations and standards and their relationship with trade using different econometric models In the first article, the standard factor endowment approach is employed to explain the effects of environmental regulatory policy on net exports in different manufacturing industries. The study hypothesizes that a countrys comparative advantage depends on its factor abundance. The regulatory policy increases production costs and, thus, reduces the output level of an industry. The results indicate that each industry is unique in the factors determining net exports and in many instances environmental regulations are important. In the second article, we investigate the impact of competition policy on a countrys production and export competitiveness. Since the impact of competition regulation depends upon the particular circumstances of the industry to which the policy is applied, we examine how competition policy impacts production and exports of a specific sector, in particular the agri-food processing sector. The results suggest that competition policy enhances competition by reducing entry barriers, and causes firms to produce more output with lower prices. Exports for both total and food manufacturing in the post-competition policy period are higher than exports in the pre-competition period. In the third article, we estimate regressions based on an extended gravity model to determine the possible influence of food safety standards on export flows of six Asia-Pacific countries to ten importing countries. We examine the relationship between bilateral exports and importers imposition of food safety standards. The results show that the value of exports in food and food products is negatively affected by food safety standards: the greater the aflatoxin standards, the lower its restrictiveness, and higher the bilateral export flows.

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