Working Paper: NBER ID: w21488
Authors: Kyle Bagwell; Robert W. Staiger; Ali Yurukoglu
Abstract: This paper empirically examines recently declassified data from the GATT/WTO on tariff bargaining. We document eight stylized facts about these interconnected high-stakes international negotiations. We use detailed product-level offer and counteroffer data to examine several questions about trade policy, including whether preferential tariffs were a stumbling block towards liberalization, and whether the relaxation of bilateral reciprocity to multilateral reciprocity aided liberalization. We organize the empirical analysis around a theoretical model of multi-party trade negotiations motivated by the terms-of-trade theory and respecting the institutional features of most-favored-nation status and reciprocity.
Keywords: GATT; WTO; Tariff Bargaining; Trade Liberalization; Preferential Tariffs
JEL Codes: C78; D02; F13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Breakdown of US-UK bilateral negotiations (F51) | Changes in US offers to other countries (F69) |
| Higher importer market power (D43) | Increased likelihood of US making offers (F59) |
| Presence of preferential trade agreements (PTAs) (F13) | Increased likelihood of US making offers (F59) |
| Presence of preferential trade agreements (PTAs) (F13) | Increased likelihood of US offers failing (F69) |
| Multilateralization of trade bargaining (F13) | Facilitates liberalization (F69) |