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Technical Entry Barriers and Economic Intergration: The Role of Industry Standards

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  • Astri Muren

    (Department of Economics, Stockholm University, Stockholm, Sweden)

Abstract

National industry standards create entry barriers which lead to the segmentation of international markets. Depending on the size of the testing cost required to certify a product's compliance with the national standard, and on the discount factor, trade in a particular market will be affected in one of three ways: there may be no trade, there may be trade subject to the trader/producer paying the testing cost, or there may be trade in sub-standard quality. Harmonization of standards will reduce barriers and will thus lead to increase trade and lower product pricesá the given level of industry standards.

Suggested Citation

  • Astri Muren, 1997. "Technical Entry Barriers and Economic Intergration: The Role of Industry Standards," Homo Oeconomicus, Institute of SocioEconomics, vol. 14, pages 309-329.
    • Handle: RePEc:hom:homoec:v:14:y:1997:p:309-329
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