IDEAS home Printed from https://ideas.repec.org/p/eab/tradew/22312.html
   My bibliography  Save this paper

Policy Reversals, Lobby Groups and Economic Distortions

Author

Listed:
  • Rafaelita M. Aldaba

    (PIDS)

Abstract

This paper aims to review the impact of the various tariff legislations passed from 1998 to 2003 on the structure of protection in the Philippines. The paper finds that while the overall level of effective protection has declined, it has remained uneven as some selected sectors have continued to receive relatively high effective rates of protection. As such, the economic distortions that characterize our tariff structure have continued to prevail and have led to the inefficient use of resources. The tariff structure continues to favor the manufacture of highly protected import substitutes at the expense of exportables. Oftentimes, the favored sectors are intermediate goods like sugar, petrochemicals, float glass, and steel which are inputs to a lot of products. Since the tariffs on the inputs are higher than the outputs, the cost of production has remained high affecting the competitiveness of the user sectors. The large disparities in tariff protection has provided incentives for lobbying. Thus, sustaining the trade reforms and encouraging competition to promote efficiency and consumer welfare has been very difficult.

Suggested Citation

  • Rafaelita M. Aldaba, 2005. "Policy Reversals, Lobby Groups and Economic Distortions," Trade Working Papers 22312, East Asian Bureau of Economic Research.
    • Handle: RePEc:eab:tradew:22312
    as

    Download full text from publisher

    File URL: http://www.eaber.org/node/22312
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Dani Rodrik, 1989. "Credibility of Trade Reform — a Policy Maker's Guide," The World Economy, Wiley Blackwell, vol. 12(1), pages 1-16, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Erwin L. Corong, 2007. "Economic and Poverty Impacts of a Voluntary Carbon Reduction for a Small Liberalized Developing Economy: The Case of the Philippines," Working Papers 2007.9, Fondazione Eni Enrico Mattei.
    2. John Cockburn & Erwin L. Corong & Caesar B. Cororaton, 2008. "Poverty Effects of the Philippines’ Tariff Reduction Program: Insights from a Computable General Equilibrium Analysis," Asian Economic Journal, East Asian Economic Association, vol. 22(3), pages 289-319, September.
    3. Caesar B. Cororaton & Erwin L. Corong, 2006. "Agriculture-sector Policies and Poverty in the Philippines: a Computable General-Equilibrium (CGE) Analysis," Working Papers MPIA 2006-09, PEP-MPIA.
    4. Aldaba, Rafaelita M., 2012. "Trade Reforms, Competition, and Innovation in the Philippines," Discussion Papers DP 2012-06, Philippine Institute for Development Studies.
    5. Cororaton, Caesar B. & Corong, Erwin L. & Cockburn, John, 2009. "Agricultural Price Distortions, Poverty and Inequality in the Philippines," Agricultural Distortions Working Paper Series 52790, World Bank.
    6. David, Cristina C. & Intal, Ponciano & Balisacan, Arsenio M., 2007. "Distortions to Agricultural Incentives in the Philippines," Agricultural Distortions Working Paper Series 48477, World Bank.
    7. Aldaba, Rafaelita M., 2005. "The Impact of Market Reforms on Competition, Structure and Performance of the Philippine Economy," Discussion Papers DP 2005-24, Philippine Institute for Development Studies.
    8. Aldaba, Rafaelita M., 2012. "Surviving Trade Liberalization in Philippine Manufacturing," Discussion Papers DP 2012-10, Philippine Institute for Development Studies.
    9. Cororaton, Caesar B., 2008. "The Philippines: Shadow WTO Agricultural Domestic Support Notifications," IFPRI discussion papers 827, International Food Policy Research Institute (IFPRI).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Collier, Paul & Guillaumont, Patrick & Guillaumont, Sylviane & Gunning, Jan Willem, 1997. "Redesigning conditionality," World Development, Elsevier, vol. 25(9), pages 1399-1407, September.
    2. Yermakov, Yuri Y., 1997. "Credibility of economic reform and foreign direct investment in the former Soviet Union region," ISU General Staff Papers 1997010108000012835, Iowa State University, Department of Economics.
    3. Zorob, Anja, 2007. "The Potential of Regional Integration Agreements (RIAs) in Enhancing the Credibility of Reform: The Case of the Syrian-European Association Agreement," GIGA Working Papers 51, GIGA German Institute of Global and Area Studies.
    4. Leonardo Baccini, 2010. "Explaining formation and design of EU trade agreements: The role of transparency and flexibility," European Union Politics, , vol. 11(2), pages 195-217, June.
    5. C. Martinelli & M. Tommasi, 1997. "Sequencing of Economic Reforms in the Presence of Political Constraints," Economics and Politics, Wiley Blackwell, vol. 9(2), pages 115-131, July.
    6. repec:dgr:rugsom:99e37 is not listed on IDEAS
    7. Edward D. Mansfield & Jon C. Pevehouse, 2008. "Democratization and the Varieties of International Organizations," Journal of Conflict Resolution, Peace Science Society (International), vol. 52(2), pages 269-294, April.
    8. Tommasi, Mariano, 2006. "The institutional foundations of public policy," LSE Research Online Documents on Economics 123104, London School of Economics and Political Science, LSE Library.
    9. Bhattacharya, Rina, 1999. "Capital flight under uncertainty about domestic taxation and trade liberalization," Journal of Development Economics, Elsevier, vol. 59(2), pages 365-387, August.
    10. Liu, Meng-chun, 2002. "Determinants of Taiwan's Trade Liberalization: The Case of a Newly Industrialized Country," World Development, Elsevier, vol. 30(6), pages 975-989, June.
    11. Baccini, Leonardo, 2010. "Explaining formation and design of EU trade agreements: the role of transparency and flexibility," LSE Research Online Documents on Economics 45565, London School of Economics and Political Science, LSE Library.
    12. Dani Rodrik, 1992. "The Rush to Free Trade in the Developing World: Why So Late? Why Now? Will it Last?," NBER Working Papers 3947, National Bureau of Economic Research, Inc.
    13. Koop, Michael J. & Nunnenkamp, Peter, 1994. "Die Transformationskrise in Mittel- und Osteuropa: Ursachen und Auswege," Open Access Publications from Kiel Institute for the World Economy 1590, Kiel Institute for the World Economy (IfW Kiel).
    14. World Bank, 2005. "Bolivia : Country Economic Memorandum, Policies to Improve Growth and Employment," World Bank Publications - Reports 8399, The World Bank Group.
    15. Bigsten, Arne, 1998. "Can Aid Generate Growth in Africa?," Working Papers in Economics 3, University of Gothenburg, Department of Economics.
    16. Lensink, Robert, 1999. "Uncertainty, financial development and economic growth: an empirical analysis," Research Report 99E37, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    17. Buffie, Edward F., 1995. "Trade liberalization, credibility and self-fulfilling failures," Journal of International Economics, Elsevier, vol. 38(1-2), pages 51-73, February.
    18. Lopez, Juan J., 1998. "Private Investment Response to Neoliberal Reforms in a Delegative Democracy: Reflections on Argentina," The Quarterly Review of Economics and Finance, Elsevier, vol. 38(3, Part 1), pages 441-457.
    19. Bhattacharya, Rina, 1997. "Pace, sequencing and credibility of structural reforms," World Development, Elsevier, vol. 25(7), pages 1045-1061, July.
    20. Andrew Feltenstein & Saleh M. Nsouli, 2003. ""Big Bang" Versus Gradualism in Economic Reforms: An Intertemporal Analysis with an Application to China," IMF Staff Papers, Palgrave Macmillan, vol. 50(3), pages 1-6.
    21. Cesar Martinelli, 2001. "Essays on Political Economy of Political Reform," Levine's Working Paper Archive 625018000000000135, David K. Levine.

    More about this item

    Keywords

    effective protection; tariff structure; trade policy;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eab:tradew:22312. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Shiro Armstrong (email available below). General contact details of provider: https://edirc.repec.org/data/eaberau.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.