RESEARCH AND ANALYSIS: WORKING PAPERS

An Empirical Assessment of the Economic Effects of WTO Accession and its Commitments

Besides facilitating access to the world market, WTO accession negotiations entail a process of domestic reforms that are expected to improve the supply side of acceding economies. However, measuring the actual impact of accession remains an empirical debate.

The present paper contributes to the issue by offering a novel measure of the specific commitments made during the negotiations. These commitments often trigger a series of domestic structural transformations that are expected to impact economic growth. The accession commitment index proposed in the paper reflects the heterogenous distribution of commitments undertaken by Article XII members. This index is used to conduct a thorough statistical exploration of the effect of WTO accession on a series of variables related to economic growth, such as trade and investment. The results show that the impact of WTO membership on the Trade/GDP ratio is significantly higher than previous studies had found for developing countries, both quantitively and qualitatively. The results on investment, be it foreign or domestic, are also encouraging, but are not fully conclusive.

No: ERSD-2017-05

Authors: Vicky Chemutai and Hubert Escaith

Manuscript date: January 2017

Key Words:

WTO Accession, Article XII, synthetic index, exploratory data analysis.

JEL classification numbers:

C31, C38, F13, F14, F43, F63, O43

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Disclaimer 

This is a working paper, and hence it represents research in progress. The opinions expressed in this paper are those of its author. They are not intended to represent the positions or opinions of the WTO or its members and are without prejudice to members' rights and obligations under the WTO. Any errors are attributable to the author.

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