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The Consequences of Non-Tariff Trade Barriers: Theory and Evidence from Import Licenses in Argentina

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Listed:
  • Juarez, Leticia
  • Bernini, Federico
  • García-Lembergman, Ezequiel

Abstract

As WTO regulations limited tariffs, non-tariff barriers, such as import licenses (NAILs), became essential trade policy tools. This paper examines how NAILs impact downstream firms in Argentina. Using a novel dataset and the staggered introduction of NAILs between 2005-2011 for identification, we analyze their causal effects on firms' imports and the subsequent effect on exports and employment. Results indicate that NAILs reduce firms' imports, inducing more exposed firms to reduce exports and employment. A trade model with oligopolistic competition suggests that firms' market power can moderate the impact of NAILs in highly concentrated markets.

Suggested Citation

  • Juarez, Leticia & Bernini, Federico & García-Lembergman, Ezequiel, 2024. "The Consequences of Non-Tariff Trade Barriers: Theory and Evidence from Import Licenses in Argentina," IDB Publications (Working Papers) 13961, Inter-American Development Bank.
    • Handle: RePEc:idb:brikps:13961
    DOI: http://dx.doi.org/10.18235/0013271
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    More about this item

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission
    • F68 - International Economics - - Economic Impacts of Globalization - - - Policy

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