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Are EU trade preferences really effective? An impact evaluation assessment of the Southern Mediterranean Countries’ case

journal contribution
posted on 2023-06-09, 05:28 authored by Emiliano Magrini, Pierluigi Montalbano, Silvia Nenci
This work assesses the causal impact of the EU trade preferences granted to the Southern Mediterranean Countries (SMCs) in agriculture and fishery products over the period 2004–2014. It overcomes some of the weaknesses of previous assessments and presents several methodological improvements. Firstly, it relies on a continuous treatment – i.e. preferential margins – to capture the ‘average treatment effect’ of trade preferences, rather than on a binary treatment based on dummy variables. Secondly, it uses highly disaggregated data at sectoral level in order to evaluate properly the preferential treatment. Thirdly, it applies a non-parametric matching technique for continuous treatment – specifically, a generalized propensity score matching. The results show, on the one hand, that the impact of the EU preferences is positive and significant on SMCs trade and is better evaluated using impact evaluation techniques. On the other hand, they demonstrate that the relationship between preferences and trade flows is asymmetric and warn against the risk of providing too much of a good thing. These results raise important issues for policy-making. First, they demonstrate that raising the level of preferences is not the solution to foster the SMCs trade towards EU. Second, that the policy-makers should put more emphasis on complementary factors other than trade barriers.

History

Publication status

  • Published

Journal

International Review of Applied Economics

ISSN

0269-2171

Publisher

Taylor & Francis

Issue

1

Volume

31

Page range

126-144

Department affiliated with

  • Economics Publications

Full text available

  • No

Peer reviewed?

  • Yes

Legacy Posted Date

2017-03-15

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