To Örebro University

oru.seÖrebro University Publications
CiteExportLink to record
Permanent link

Direct link
Cite
Citation style
  • apa
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf
Tariff overhang and aid: Theory and empirics
RWTH Aachen University, School of Business and Economics, Aachen, Germany.
Örebro University, Örebro University School of Business. University of Malta, Institute for European Studies, Msida, Malta.ORCID iD: 0000-0002-7540-9295
2024 (English)In: Journal of Development Economics, ISSN 0304-3878, E-ISSN 1872-6089, Vol. 166, article id 103209Article in journal (Refereed) Published
Abstract [en]

In this paper, we consider aid payments as a possible explanation for tariff overhangs. We set up a theoretical model in which rich countries use development aid to pay for tariff concessions by poorer countries. The more aid they receive as compensation, the more poor countries reduce the applied tariff below the bound tariff rate. Anticipating this mechanism, countries can negotiate a bound tariff rate that induces the joint optimal applied tariff and aid as outcomes. We empirically examine the relationship between tariff overhangs and donor aid preferences using detailed data on WTO members’ bound and applied tariff rates under the Uruguay agreement. The data sample contains a predominant majority of WTO members that are aid recipients under the Uruguay agreement. Our results provide support for the model’s aid-for-trade mechanism.

Place, publisher, year, edition, pages
Elsevier, 2024. Vol. 166, article id 103209
Keywords [en]
Foreign aid, Tariff formation, Tariff overhang
National Category
Economics
Identifiers
URN: urn:nbn:se:oru:diva-109727DOI: 10.1016/j.jdeveco.2023.103209ISI: 001112395600001Scopus ID: 2-s2.0-85177168174OAI: oai:DiVA.org:oru-109727DiVA, id: diva2:1812009
Available from: 2023-11-15 Created: 2023-11-15 Last updated: 2024-01-10

Open Access in DiVA

Tariff overhang and aid: Theory and empirics(669 kB)39 downloads
File information
File name FULLTEXT01.pdfFile size 669 kBChecksum SHA-512
64bc8b891805e4b4ad95f0606c338682254bc1e0a36dc0f541fc98bb5304c3e341bae2324d9040894f0172927128c31d127193ebccb639368370e56210e1d9d2
Type fulltextMimetype application/pdf

Other links

Publisher's full textScopus

Authority records

Thede, Susanna

Search in DiVA

By author/editor
Thede, Susanna
By organisation
Örebro University School of Business
In the same journal
Journal of Development Economics
Economics

Search outside of DiVA

GoogleGoogle Scholar
Total: 39 downloads
The number of downloads is the sum of all downloads of full texts. It may include eg previous versions that are now no longer available

doi
urn-nbn

Altmetric score

doi
urn-nbn
Total: 289 hits
CiteExportLink to record
Permanent link

Direct link
Cite
Citation style
  • apa
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf