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Modelling the Effects of Tariffs and Non‐Tariff Measures on Agricultural Products: Evidence From a Developing Country

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World Economy

Published online on

Abstract

["The World Economy, EarlyView. ", "\nABSTRACT\nThis paper examines how tariffs and non‐tariff measures (NTMs) imposed by Brazil's major agricultural trading partners affect the country's exports at the country–product level over the period 2000–2017. Using a newly assembled dataset of NTMs from the TRAINS database and a novel methodology for constructing unilateral trade flows in a single‐exporter setting, we estimate a reduced‐form Poisson pseudo‐maximum likelihood (PPML) model. The results show that tariffs exert large and consistently negative effects on export performance, while NTMs have heterogeneous impacts that depend on their economic characteristics and on the treatment of Brazilian products relative to competing exporters. We also introduce a measure of the cumulative trade frictions arising from the joint application of tariffs and NTMs, showing that multilateral NTMs substantially amplify the trade‐reducing effects of tariffs, particularly for price and quantity measures. Finally, an event‐study analysis based on the Local Projections Difference‐in‐Differences (LP‐DiD) estimator indicates that the introduction of a new NTM temporarily reduces the export share of the affected product, with recovery beginning in the third year after implementation.\n"]