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Measuring the costs of FTA utilization : evidence from transaction-level import data of Thailand

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  • Hayakawa, Kazunobu
  • Laksanapanyakul, Nuttawut
  • Urata, Shujiro

Abstract

In this study, we measure the utilization costs of free trade agreement (FTA) tariff schemes. To do that, we use shipment-level customs data on Thai imports, which identify not only firms, source country, and commodity but also tariff schemes. We propose several measures as a proxy for FTA utilization costs. The example includes the minimum amount of firm-level savings on tariff payments, i.e., trade values under FTA schemes multiplied by the tariff margin, in all transactions. Consequently, the median costs for FTA utilization in 2008, for example, are estimated to be approximately US$2,000 for exports from China, US$300 for exports from Australia, and US$1,000 for exports from Japan. We also found that FTA utilization costs differ by rule of origin and industry.

Suggested Citation

  • Hayakawa, Kazunobu & Laksanapanyakul, Nuttawut & Urata, Shujiro, 2015. "Measuring the costs of FTA utilization : evidence from transaction-level import data of Thailand," IDE Discussion Papers 541, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    • Handle: RePEc:jet:dpaper:dpaper541
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    More about this item

    Keywords

    Thailand; International Trade; International Agreements; Costs; Imports; FTA; Fixed Costs;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations

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