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Trade Costs and Demand-Enhancing Effects of Agrifood Standards: Consequences for Sub-Saharan Africa

Author

Listed:
  • Aristide Djimgou Tchakounte

    (Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ))

  • Dela-Dem Doe Fiankor

    (University of Goettingen)

Abstract

Agrifood standards impede trade by increasing compliance costs, but they can also enhance trade by signalling quality. This paper disentangles the trade costs and demand-enhancing effects of two important standards—technical barriers to trade, and sanitary and phytosanitary measures—on (i) global agricultural trade flows and (ii) fruit, nut, and vegetable trade between sub-Saharan Africa and high-income OECD countries. Combining estimates from unit value and trade value regressions set within structural gravity frameworks, we show that trading standards increase trade costs—which exporters pass on to consumers in the form of higher prices—but they also increase trade volume. For agrifood exports from sub-Saharan Africa, compliance with standards guarantees market access at higher prices to high-value OECD markets.

Suggested Citation

  • Aristide Djimgou Tchakounte & Dela-Dem Doe Fiankor, 2021. "Trade Costs and Demand-Enhancing Effects of Agrifood Standards: Consequences for Sub-Saharan Africa," Journal of African Trade, Springer, vol. 8(1), pages 51-64, December.
    • Handle: RePEc:spr:jouafr:v:8:y:2021:i:1:d:10.2991_jat.k.210907.001
    DOI: 10.2991/jat.k.210907.001
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    More about this item

    Keywords

    Non-tariff measures; sanitary and phytosanitary measures; technical barriers to trade; sub-Saharan Africa; ad valorem equivalent; gravity model;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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