Services Policies and Manufacturing Exports
Shepherd, Ben | December 2018
Abstract
This paper uses a structural gravity model to show the effects of services policies on manufacturing exports. Whereas the previous literature has focused on indirect effects of policies—flowing through productivity effects in domestic services markets—we look at direct effects, namely the ability of domestic manufacturers to access services inputs on world markets at competitive prices. Our results show that discriminatory barriers to services trade have a significant negative effect on manufacturing exports. We use theory-consistent counterfactual simulations to show that the trade and real output effects of a 10% reduction in services trade restrictiveness are in fact much larger than those of a 10% reduction in tariffs. On a policy level, our results suggest that an additional argument for liberalizing services markets is that it in fact aids manufacturing sector development, due to the intimate links between the two.
Citation
Shepherd, Ben. 2018. Services Policies and Manufacturing Exports. © Asian Development Bank Institute. http://hdl.handle.net/11540/9480.Keywords
Aquaculture Development
Development Economics
Export Development
Regional Development
Trade Flows
Trade And Development
Food Security And Trade
Trade Volume
Trade Potential
Trade Flows
External Trade
Industrial policy
New technology
Innovations
Industry
Export policy
Import policy
Trade Unions
Economic development
Development potential
Fishery projects
Local Industry
Fishery Economics
Fishery Product Processing
Trade development
Import volume
Export volume
Food trade
Food industry and trade
Fishery products
Economic development projects
Developing countries
Developing island countries
Partnership
Joint venture
System analysis
Labor and globalization
Labor policy
Regional trading blocs
Foreign trade and employment
Developing countries
Industrial priorities
Technological innovation
Technology transfer
Foreign trade regulation
Industrial relations
Trade-unions
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