The Impact of Services Trade Restrictiveness on Trade Flows
2016 (English)In: The World Economy, ISSN 0378-5920, E-ISSN 1467-9701Article in journal (Refereed) Epub ahead of print
This paper uses recent OECD data on services trade restrictions (STRI) to analyse the relationship between services trade policies and cross-border trade in services. A standard gravity model is enhanced by the STRI indices in a cross-section regression analysis. Services trade restrictions are negatively associated with both imports and exports of services. The surprisingly strong effect on services exports is probably explained by a negative relationship between the STRIs and sector performance indicators. Consequently, services suppliers from less open countries are less competitive abroad. Bilateral differences in regulation are also found to curtail services trade over and above the impact of the trade liberalisation level. At the margin, regulatory differences have a larger effect on trade flows the lower the level of the STRI.
Place, publisher, year, edition, pages
Research subject Economics
IdentifiersURN: urn:nbn:se:oru:diva-54182DOI: 10.1111/twec.12424OAI: oai:DiVA.org:oru-54182DiVA: diva2:1059499