RESEARCH AND ANALYSIS: WORKING PAPERS
Trade and Welfare Effects of the WTO Trade Facilitation Agreement
The WTO Trade Facilitation Agreement (TFA) has been predicted to bring about an expansion in trade flows and real income gains. To date, there is still very limited empirical evidence on the actual post-implementation impact of the TFA. This paper provides an assessment, combining econometric estimations from a structural gravity model with general equilibrium modelling results
The main insight is that the TFA increased trade, in particular in agriculture, between developing countries that made commitments. General equilibrium estimations indicate that agricultural trade increases by 5% worldwide, while total trade increases by 1.17% worldwide as a result of TFA implementation. Trade gains accrue in particular to LDCs, whose exports increase by 2.4% overall (17% in agriculture). Furthermore, as a result of TFA implementation, real income increases by 0.12% worldwide (0.24% for LDCs).
No: ERSD-2023-04
Authors: Cosimo Beverelli, Isabella Gourevich, Inga Heiland, Alexander Keck, Mario Larch, Yoto V. Yotov
Manuscript date: 15 February 2023
Key Words:
Trade facilitation, Structural gravity, CGE models
JEL classification numbers:
F13, F14, F17
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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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