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Trade effects of MRL harmonization in the EU

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  • Foletti, Liliana
  • MILE 02, Anirudh Shingal

Abstract

Combining original data on Maximum Residue Levels (MRLs) in pesticides with bilateral trade and standard gravity variables over 2005-11, this paper identifies the effect of the complete harmonization of MRLs across EU member states on inter- and intra-EU agri-food trade at both margins. We make an empirical contribution to the impact assessment of standards literature by identifying the trade effects of two different harmonization dynamics in health-related standards: complete harmonization of domestic and foreign regulation (intra-EU members) and harmonization of standards between a large number of foreign markets (non EU-members). Significantly, we find that the harmonization of MRL standards may have led to greater trade at both margins for all different sub-samples, even those including developing country exporters. Our results also suggest that having different MRL regulations is mostly costly at the extensive margin; this is found to be especially true for intra-EU15 agri-trade.

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  • Foletti, Liliana & MILE 02, Anirudh Shingal, 2014. "Trade effects of MRL harmonization in the EU," Papers 720, World Trade Institute.
    • Handle: RePEc:wti:papers:720
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    Cited by:

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    2. Olaide Akin-Olagunju & Abiodun Falusi & Sulaiman Yusuf & Victor Okoruwa, 2022. "Does Pesticide Regulation Impact the Export Competitiveness of Major Global Cocoa Producers?," Journal of African Trade, Springer, vol. 9(1), pages 47-72, December.
    3. Akin-Olagunju, O. & Yusuf, S. & Okoruwa, V., 2018. "Harmonization of Sanitary and Phytosanitary Standards in Cocoa Trade: How Competitive are the Major Exporting Countries?," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277463, International Association of Agricultural Economists.
    4. Hejazi, Mina & Grant, Jason H. & Peterson, Everett, 2016. "Hidden Trade Costs? Maximum Residue Limits and US Exports to Trans-Atlantic and Trans-Pacific Trading Partners," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235847, Agricultural and Applied Economics Association.

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