IDEAS home Printed from https://ideas.repec.org/p/hal/journl/hal-01659787.html
   My bibliography  Save this paper

Impact of European food safety border inspections on agri-food exports: Evidence from Chinese firms

Author

Listed:
  • Matthias Beestermöller

    (LMU - Ludwig Maximilian University [Munich] = Ludwig Maximilians Universität München)

  • Anne-Célia Disdier

    (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)

  • Lionel Fontagné

    (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

Abstract

The cost of complying with a sanitary standard is certain. However, such measure introduces uncertainty for exporters in relation to border rejections. Shipments may fail to pass inspections and may be refused entry into the importing country. This risk is shaped by variance in the quality of the exported product, and the stringency of the border controls. We examine how the risk of rejection at European borders on safety grounds is affecting Chinese agri-food exporters. We combine information from the European Rapid Alert System for Food and Feed with Chinese firm-level export data by product, destination and year for the period 2000–2011. Information externalities and reputation effects are important. Border rejections amplify the turnover among firms at the extensive margin of trade. This risk is curbing small exporters and resulting in a concentration of Chinese exports among big exporters.

Suggested Citation

  • Matthias Beestermöller & Anne-Célia Disdier & Lionel Fontagné, 2018. "Impact of European food safety border inspections on agri-food exports: Evidence from Chinese firms," Post-Print hal-01659787, HAL.
    • Handle: RePEc:hal:journl:hal-01659787
    DOI: 10.1016/j.chieco.2017.11.004
    Note: View the original document on HAL open archive server: https://hal.science/hal-01659787
    as

    Download full text from publisher

    File URL: https://hal.science/hal-01659787/document
    Download Restriction: no
    File URL: https://libkey.io/10.1016/j.chieco.2017.11.004?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Hiau LooiKee & Alessandro Nicita & Marcelo Olarreaga, 2009. "Estimating Trade Restrictiveness Indices," Economic Journal, Royal Economic Society, vol. 119(534), pages 172-199, January.
    2. Maggie Xiaoyang Chen & Aaditya Mattoo, 2008. "Regionalism in standards: good or bad for trade?," Canadian Journal of Economics, Canadian Economics Association, vol. 41(3), pages 838-863, August.
    3. Fontagné, Lionel & Orefice, Gianluca & Piermartini, Roberta & Rocha, Nadia, 2015. "Product standards and margins of trade: Firm-level evidence," Journal of International Economics, Elsevier, vol. 97(1), pages 29-44.
    4. Disdier, Anne-Celia & Fontagne, Lionel & Mimouni, Mondher, 2008. "AJAE Appendix: The Impact of Regulations on Agricultural Trade: Evidence from the SPS and TBT Agreements," American Journal of Agricultural Economics APPENDICES, Agricultural and Applied Economics Association, vol. 90(2), pages 1-7.
    5. Jérôme Héricourt & Sandra Poncet, 2015. "Exchange Rate Volatility, Financial Constraints, and Trade: Empirical Evidence from Chinese Firms," The World Bank Economic Review, World Bank, vol. 29(3), pages 550-578.
    6. Nordås, Hildegunn Kyvik & Piermartini, Roberta, 2004. "Infrastructure and trade," WTO Staff Working Papers ERSD-2004-04, World Trade Organization (WTO), Economic Research and Statistics Division.
    7. Lionel Fontagné & Gianluca Orefice & Roberta Piermartini & Nadia Rocha, 2015. "Product Standards and Margins of Trade: Firm-Level Evidence Product Standards and Margins of Trade: Firm-Level Evidence," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-01299757, HAL.
    8. John Knowles & Nicola Persico & Petra Todd, 2001. "Racial Bias in Motor Vehicle Searches: Theory and Evidence," Journal of Political Economy, University of Chicago Press, vol. 109(1), pages 203-232, February.
    9. repec:cii:cepiei:2012-q2-130-5 is not listed on IDEAS
    10. Houssein Guimbard & Sébastien Jean & Mondher Mimouni & Xavier Pichot, 2012. "MAcMap-HS6 2007, an Exhaustive and Consistent Measure of Applied Protection in 2007," International Economics, CEPII research center, issue 130, pages 99-122.
    11. Hooper, Peter & Kohlhagen, Steven W., 1978. "The effect of exchange rate uncertainty on the prices and volume of international trade," Journal of International Economics, Elsevier, vol. 8(4), pages 483-511, November.
    12. Mélise Jaud & Olivier Cadot & Akiko Suwa-Eisenmann, 2013. "Do food scares explain supplier concentration? An analysis of EU agri-food imports," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 40(5), pages 873-890, December.
    13. McQuade, Timothy & Salant, Stephen W. & Winfree, Jason, 2016. "Markets with untraceable goods of unknown quality: Beyond the small-country case," Journal of International Economics, Elsevier, vol. 100(C), pages 112-119.
    14. Falvey, Rodney E, 1989. "Trade, Quality Reputations and Commercial Policy," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 30(3), pages 607-622, August.
    15. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, April.
    16. Jouanjean, Marie-Agnès & Maur, Jean-Christophe & Shepherd, Ben, 2015. "Reputation matters: Spillover effects for developing countries in the enforcement of US food safety measures," Food Policy, Elsevier, vol. 55(C), pages 81-91.
    17. Chen, Natalie & Novy, Dennis, 2012. "On the measurement of trade costs: direct vs. indirect approaches to quantifying standards and technical regulations," World Trade Review, Cambridge University Press, vol. 11(3), pages 401-414, July.
    18. Thierry Mayer & Gianmarco Ottaviano, 2008. "The Happy Few: The Internationalisation of European Firms," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 43(3), pages 135-148, May.
    19. Francois, Joseph F. & Martin, Will, 2004. "Commercial policy variability, bindings, and market access," European Economic Review, Elsevier, vol. 48(3), pages 665-679, June.
    20. Freund, Caroline & Rocha, Nadia, 2010. "What Constrains Africas Exports?," CAGE Online Working Paper Series 16, Competitive Advantage in the Global Economy (CAGE).
    21. Feng, Ling & Li, Zhiyuan & Swenson, Deborah L., 2017. "Trade policy uncertainty and exports: Evidence from China's WTO accession," Journal of International Economics, Elsevier, vol. 106(C), pages 20-36.
    22. Grobar, Lisa Morris, 1993. "The effect of real exchange rate uncertainty on LDC manufactured exports," Journal of Development Economics, Elsevier, vol. 41(2), pages 367-376, August.
    23. Handley, Kyle, 2014. "Exporting under trade policy uncertainty: Theory and evidence," Journal of International Economics, Elsevier, vol. 94(1), pages 50-66.
    24. repec:hal:pseose:hal-01299757 is not listed on IDEAS
    25. Grundke, Robert & Moser, Christoph, 2019. "Hidden protectionism? Evidence from non-tariff barriers to trade in the United States," Journal of International Economics, Elsevier, vol. 117(C), pages 143-157.
    26. Osnago, Alberto & Piermartini, Roberta & Rocha, Nadia, 2015. "Trade policy uncertainty as barrier to trade," WTO Staff Working Papers ERSD-2015-05, World Trade Organization (WTO), Economic Research and Statistics Division.
    27. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
    28. repec:hal:pseose:halshs-00879811 is not listed on IDEAS
    29. repec:hal:pseose:hal-01044989 is not listed on IDEAS
    30. Sergio Correia, 2014. "REGHDFE: Stata module to perform linear or instrumental-variable regression absorbing any number of high-dimensional fixed effects," Statistical Software Components S457874, Boston College Department of Economics, revised 21 Aug 2023.
    31. Carl Shapiro, 1983. "Premiums for High Quality Products as Returns to Reputations," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 98(4), pages 659-679.
    32. Essaji, Azim, 2008. "Technical regulations and specialization in international trade," Journal of International Economics, Elsevier, vol. 76(2), pages 166-176, December.
    33. Kathy Baylis & Andrea Martens & Lia Nogueira, 2009. "What Drives Import Refusals?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(5), pages 1477-1483.
    34. Daron Acemoglu & James A. Robinson, 2006. "De Facto Political Power and Institutional Persistence," American Economic Review, American Economic Association, vol. 96(2), pages 325-330, May.
    35. Kathy Baylis & Lia Nogueira & Kathryn Pace, 2010. "Food Import Refusals: Evidence from the European Union," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 93(2), pages 566-572.
    36. Ederington,Josh & Ruta,Michele, 2016. "Non-tariff measures and the world trading system," Policy Research Working Paper Series 7661, The World Bank.
    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. Gründler, Klaus & Hillman, Arye L., 2021. "Ambiguous protection," European Journal of Political Economy, Elsevier, vol. 68(C).
    2. Kathy Baylis & Lia Nogueira & Linlin Fan & Kathryn Pace, 2022. "Something fishy in seafood trade? The relation between tariff and non‐tariff barriers," American Journal of Agricultural Economics, John Wiley & Sons, vol. 104(5), pages 1656-1678, October.
    3. Rui Mao & Mengying Xing & Xiaohua Yu, 2021. "Quality response to real exchange rate shocks: A panel SVAR analysis on China's agricultural exports," Agricultural Economics, International Association of Agricultural Economists, vol. 52(5), pages 719-731, September.
    4. Grundke, Robert & Moser, Christoph, 2019. "Hidden protectionism? Evidence from non-tariff barriers to trade in the United States," Journal of International Economics, Elsevier, vol. 117(C), pages 143-157.
    5. Xi He, 2020. "US agricultural exports and labor market adjustments," Agricultural Economics, International Association of Agricultural Economists, vol. 51(4), pages 609-621, July.
    6. DOAN Thi Thanh Ha & ZHANG Hongyong, 2022. "Technical Barriers to Trade, Product Quality and Trade Margins: Firm-level evidence," Discussion papers 22056, Research Institute of Economy, Trade and Industry (RIETI).
    7. Fiankor, Dela-Dem Doe & Ehrich, Malte & Brümmer, Bernhard, 2016. "EU-African Regional Trade Agreements as a Development Tool to Reduce EU Border Rejections," GlobalFood Discussion Papers 244352, Georg-August-Universitaet Goettingen, GlobalFood, Department of Agricultural Economics and Rural Development.
    8. Fatima Olanike Kareem & Inmaculada Martínez-Zarzoso & Bernhard Brümmer, 2023. "What Drives Africa’s Inability to Comply with EU Standards? Insights from Africa’s Institution and Trade Facilitation Measures," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 35(4), pages 938-973, August.
    9. Traoré, Ousmane Z & Tamini, Lota D., 2020. "The Net Effect of the Technical Non-Tariff Measures in OECD countries on African Exports of Plant Products," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304460, Agricultural and Applied Economics Association.
    10. INUI,Tomohiko & OBASHI,Ayako & YANG,Qizhong, 2024. "Impact of border rejection experience on export performance: Firm-level evidence from China," IDE Discussion Papers 930, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    11. Shuyao Yang, 2020. "Technical Barriers to Trade and Firms' Export Decisions," CESifo Working Paper Series 8693, CESifo.
    12. Jie Ma & Rong Cai & Weifu Zhang, 2023. "Has the Decline in Trade Policy Uncertainty Promoted China’s Agricultural Exports?," Sustainability, MDPI, vol. 15(14), pages 1-14, July.
    13. Li, Haoran & Wan, Xibo & Zhang, Wendong, 2021. "How do Firms Respond to Long-term Political Tensions? Evidence from Chinese Food Importers," ISU General Staff Papers 202106020700001118, Iowa State University, Department of Economics.
    14. Shingal, Anirudh & Ehrich, Malte, 2024. "The EU’s pesticides MRLs harmonization: effect on trade, prices and quality," Food Policy, Elsevier, vol. 125(C).
    15. Luisa Kinzius & Alexander Sandkamp & Erdal Yalcin, 2019. "Trade protection and the role of non-tariff barriers," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 155(4), pages 603-643, November.
    16. Mao, Rui & Liu, Yuhang & Wang, Xiaoxi, 2023. "Economic and environmental impacts of agricultural non-tariff measures: evidence based on ad valorem equivalent estimates," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 26(3), January.
    17. Yang, Qizhong, 2024. "Heterogeneous impact of non-tariff measures on import margins through global value chains: Firm-level evidence from China," International Review of Economics & Finance, Elsevier, vol. 92(C), pages 533-562.
    18. Jin, Yu & Zhou, Jiehong & Ye, Juntao, 2023. "Value of certification in collective reputation crises: Evidence from Chinese dairy firms," Food Policy, Elsevier, vol. 121(C).
    19. Lili Yan ING & Olivier CADOT, 2017. "Remaking Ad valorem equivalents of non-tariff measures in ASEAN," Working Papers DP-2017-09, Economic Research Institute for ASEAN and East Asia (ERIA).
    20. Rui Mao & Ziyi Jia & Kevin Chen, 2021. "Impacts of Import Refusals on Agricultural Exports during Pandemics: Implications for China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 29(4), pages 113-141, July.
    21. Najla KAMERGI & Gabriel FIGUEIREDO DE OLIVEIRA, 2021. "Les mesures techniques non tarifaires :quels effets sur les exportations agricoles des pays africains ?," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 54, pages 31-50.
    22. Liu, Qing & Ma, Hong, 2020. "Trade policy uncertainty and innovation: Firm level evidence from China’s WTO accession," Journal of International Economics, Elsevier, vol. 127(C).
    23. Jason A. Winfree, 2023. "Collective reputation and food," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 45(2), pages 666-683, June.
    24. Jiehong Zhou & Yu Wang & Rui Mao, 2019. "Dynamic and spillover effects of USA import refusals on China's agricultural trade: Evidence from monthly data," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 65(9), pages 425-434.

    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. Grundke, Robert & Moser, Christoph, 2019. "Hidden protectionism? Evidence from non-tariff barriers to trade in the United States," Journal of International Economics, Elsevier, vol. 117(C), pages 143-157.
    2. Schmidt, Julia & Steingress, Walter, 2022. "No double standards: Quantifying the impact of standard harmonization on trade," Journal of International Economics, Elsevier, vol. 137(C).
    3. Ederington,Josh & Ruta,Michele, 2016. "Non-tariff measures and the world trading system," Policy Research Working Paper Series 7661, The World Bank.
    4. Eyal RONEN, 2017. "Quantifying the trade effects of NTMs: A review of the empirical literature," Journal of Economics and Political Economy, KSP Journals, vol. 4(3), pages 263-274, September.
    5. Kan Yue, 2022. "Non‐tariff measures, product quality and import demand," Economic Inquiry, Western Economic Association International, vol. 60(2), pages 870-900, April.
    6. Curzi, Daniele & Schuster, Monica & Maertens, Miet & Olper, Alessandro, 2020. "Standards, trade margins and product quality: Firm-level evidence from Peru," Food Policy, Elsevier, vol. 91(C).
    7. Anne‐Célia Disdier & Carl Gaigné & Cristina Herghelegiu, 2023. "Do standards improve the quality of traded products?," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 56(4), pages 1238-1290, November.
    8. Olivier Cadot & Julien Gourdon, 2016. "Non-tariff measures, preferential trade agreements, and prices: new evidence," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 152(2), pages 227-249, May.
    9. Jaime de Melo & Alessandro Nicita, 2018. "Non-Tariff Measures: Data and Quantitative Tools of Analysis," Post-Print hal-01731305, HAL.
    10. Grant, Jason & Arita, Shawn, 2017. "Sanitary and Phyto-Sanitary Measures: Assessment, Measurement, and Impact," Commissioned Papers 259417, International Agricultural Trade Research Consortium.
    11. Shuyao Yang, 2020. "Technical Barriers to Trade and Firms' Export Decisions," CESifo Working Paper Series 8693, CESifo.
    12. Fontagné, Lionel & Orefice, Gianluca, 2018. "Let’s try next door: Technical Barriers to Trade and multi-destination firms," European Economic Review, Elsevier, vol. 101(C), pages 643-663.
    13. Kareem, Fatima Olanike & Martínez-Zarzoso, Inmaculada & Brümmer, Bernhard, 2018. "Protecting health or protecting imports? Evidence from EU non-tariff measures," International Review of Economics & Finance, Elsevier, vol. 53(C), pages 185-202.
    14. Jaime DE MELO & Ben SHEPHERD, 2018. "The Economics of Non-Tariff Measures: A Primer," Working Papers P212, FERDI.
    15. Jouanjean, Marie-Agnès & Maur, Jean-Christophe & Shepherd, Ben, 2015. "Reputation matters: Spillover effects for developing countries in the enforcement of US food safety measures," Food Policy, Elsevier, vol. 55(C), pages 81-91.
    16. Benjamin Jung, 2016. "Trade creating oder Trade diverting - Ökonomische Perspektiven auf den Abbau technischer Handelshemmnisse in multilateralem oder regionalem Rahmen," IAW Discussion Papers 127, Institut für Angewandte Wirtschaftsforschung (IAW).
    17. Jouanjean, Marie-Agnes & Maur, Jean-Christophe & Shepherd, Ben, 2011. "Reputation matters: Spillover effects in the enforcement of US SPS measures," MPRA Paper 35270, University Library of Munich, Germany.
    18. Giorgio Barba Navaretti & Giulia Felice & Emanuele Forlani & Paolo Garella, 2018. "Non-tariff measures and competitiveness," Development Working Papers 438, Centro Studi Luca d'Agliano, University of Milano, revised 01 Feb 2023.
    19. Salamat Ali, 2016. "Export Response to Sanitary and Phytosanitary Measures and Technical Barriers to Trade: Firm-level Evidence from a Developing Country," Discussion Papers 2016-02, University of Nottingham, CREDIT.
    20. Bossoma Doriane N’DOUA, 2022. "The Impact of Technical Barriers to Trade and Sanitary and Phytosanitary Measures on Trade in the Forest-Wood-Paper Sector," Bordeaux Economics Working Papers 2022-01, Bordeaux School of Economics (BSE).

    More about this item

    Keywords

    food safety; border inspections; import refusals; uncertainty; firm heterogeneity;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • 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

    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:hal:journl:hal-01659787. 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: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    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.