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GTAP Resource #4175

"How much do tariffs matter? Evidence from the Customs Union of Belarus, Kazakhstan and Russia"
Authors: Isakova, Asel, Zsoka Koczan and Alexander Plekhanov


Abstract
In November 2009 Belarus, Kazakhstan and Russia agreed to establish a Customs Union with harmonized import tariffs. The new common tariff became effective on 1 January 2010, and internal border controls have been subsequently removed. The common external customs tariff is mainly based on the Russian duties prevailing at the time; however its introduction resulted in changes to the import tariff structure in each country.
The main objective of the Customs Union is to foster economic integration between the three countries. The plans are to pursue integration further within the framework of the Common Economic Space, with the ultimate goal of achieving free movement of goods, capital and labour.
In general, tariffs are imposed to constrain the volume of imports by increasing their cost to domestic consumers, therefore, all other things equal, the higher the tariff barriers, the more trade should fall.
In this paper we look at the effects of the changes in tariffs due to the formation of the customs union between these three countries. We examine the structure and the volume of imports to the three countries from the world and different trade partners. In particular, we estimate a short-term impact of the changes in tariffs by comparing imports from various trade partners in the sectors where tariffs changed and in those where they did not.
The structure of the trade flows of individual countries can be analysed using annual bilateral trade data from the Trade Map database of the International Trade Center of UNCTAD/WTO (ITC) at the six-digit level of disaggregation of the Harmonised System (HS) classification.
In our empirical model we estimate the effect of a change in tariffs on changes in import inflows to the Customs Union countries from 2009 to 2010. Besides changes in tariffs, our model specification includes such variables as changes in import flows before the crisis (2006-2008 and 2008-2009), the change in imports from all countries over the sam...


Resource Details () GTAP Keywords
Category: 2013 Conference Paper
Status: Published
By/In: Presented at the 16th Annual Conference on Global Economic Analysis, Shanghai, China
Date: 2013
Version:
Created: Plekhanov, A. (4/15/2013)
Updated: Batta, G. (5/2/2013)
Visits: 1,120
- Multilateral trade negotiations
- Non-Tariff barriers


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