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Do Standards Improve the Quality of Traded Products?
[Les normes améliorent-elles la qualité des produits importés ?]

Author

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  • Carl Gaigne

    (SMART-LERECO - Structures et Marché Agricoles, Ressources et Territoires - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - INSTITUT AGRO Agrocampus Ouest - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement)

  • 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)

  • Cristina Herghelegiu

    (European Commission [Brussels])

Abstract

We examine whether standards raise the quality of traded products by correcting market failures associated with information asymmetry on product attributes. Matching a panel of French firmproduct-destination export data with a dataset on sanitary and phytosanitary (SPS) measures and technical barriers to trade (TBTs), we find that such quality standards enforced on products by destination countries: (i) favor the export probability of high-quality firms provided that their productivity is high enough; (ii) raise the export sales of high-productivity high-quality firms at the expense of low-productivity and low-quality firms; (iii) improve the average quality of consumption goods exported by France. We then develop a simple new trade model under uncertainty about product quality, in which heterogeneous firms can strategically invest in quality signaling, to rationalize these empirical results on quality and selection effects.

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  • Carl Gaigne & Anne-Célia Disdier & Cristina Herghelegiu, 2021. "Do Standards Improve the Quality of Traded Products? [Les normes améliorent-elles la qualité des produits importés ?]," Working Papers hal-03623098, HAL.
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    Cited by:

    1. Luca Macedoni & Ariel Weinberger, 2021. "Quality Misallocation, Trade, and Regulations," CESifo Working Paper Series 9041, CESifo.
    2. 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.
    3. 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.
    4. Macedoni, Luca & Weinberger, Ariel, 2022. "Quality heterogeneity and misallocation: The welfare benefits of raising your standards," Journal of International Economics, Elsevier, vol. 134(C).
    5. Duc Anh Dang & Vuong Anh Dang, 2021. "The Effects of SPSs and TBTs on Innovation: Evidence from Exporting Firms in Viet Nam," Working Papers DP-2021-16, Economic Research Institute for ASEAN and East Asia (ERIA).
    6. 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.
    7. Doan Thi Thanh Ha & Hongyong Zhang, 2022. "Technical Barriers to Trade, Product Quality and Trade Margins: Firm-level Evidence," Working Papers DP-2021-54, Economic Research Institute for ASEAN and East Asia (ERIA).
    8. Ariel Weinberger & Luca Macedoni, 2023. "International Spillovers of Quality Regulations," Working Papers 2023-10, The George Washington University, Institute for International Economic Policy.
    9. Nabeshima, Kaoru & Obashi, Ayako & Kim, Kunhyui, 2021. "Impacts of additional compliance requirements of regulations on the margins of trade," Japan and the World Economy, Elsevier, vol. 59(C).
    10. Kan Yue, 2022. "Non‐tariff measures, product quality and import demand," Economic Inquiry, Western Economic Association International, vol. 60(2), pages 870-900, April.
    11. Djolaud, Guy, 2022. "Import Penetration of Low Quality Products : Markups Implications," MPRA Paper 114611, University Library of Munich, Germany.
    12. Beguin, Malo, 2021. "Harmonization, Mutual Recognition or National Treatment: a Melitz approach," LIDAM Discussion Papers LFIN 2021010, Université catholique de Louvain, Louvain Finance (LFIN).
    13. Mahdi Ghodsi, 2023. "Regulatory Convergence within Technical Barriers to Trade," wiiw Working Papers 229, The Vienna Institute for International Economic Studies, wiiw.
    14. Ghodsi, Mahdi, 2023. "Exploring the ‘non-tariff measures black box’: Whose regulatory NTMs on which products improve the imported quality?," International Economics, Elsevier, vol. 173(C), pages 45-67.
    15. Shingal, Anirudh & Ehrich, Malte, 2024. "The EU’s pesticides MRLs harmonization: effect on trade, prices and quality," Food Policy, Elsevier, vol. 125(C).
    16. Payam Elhami & Mahdi Ghodsi & Robert Stehrer, 2021. "Quality of Goods Imports: Which Role for Non-tariff Measures?," wiiw Policy Notes 46, The Vienna Institute for International Economic Studies, wiiw.

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    More about this item

    Keywords

    Heterogeneity; Firm exports; Quality standards; Information asymmetry; Product quality; Exportation; Normes de qualité; Asymétrie d’information; Qualité des produits; Hétérogénéité;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

    NEP fields

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