Quantitative Economics

Journal Of The Econometric Society

Edited by: Stéphane Bonhomme • Print ISSN: 1759-7323 • Online ISSN: 1759-7331

Quantitative Economics: May, 2024, Volume 15, Issue 2

Heterogeneous effects of tariff and nontariff trade-policy barriers in quantitative general equilibrium

https://doi.org/10.3982/QE1994
p. 453-487

Peter H. Egger, Katharina Erhardt

Structural quantitative work in international economics typically models trade costs as a log‐linear function of exogenous trade‐policy variables. We propose a structural approach that allows for a nonparametric relationship and for treating tariff and nontariff trade‐policy variables as potentially endogenous. The data reject the assumption of log‐linearity of trade costs in both tariff‐ and nontariff‐policy variables. We assess the effects of a unilateral increase of US tariffs on Chinese imports by 10 percentage points and document that the estimated effects on real bilateral trade‐flow changes would be substantially underestimated by standard approaches.


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Supplemental Material

Supplement to "Heterogeneous Effects of Tariff and Non-tariff Trade-Policy Barriers in Quantitative General Equilibrium"

Peter H. Egger and Katharina Erhardt

This appendix contains material not found within the manuscript.

Supplement to "Heterogeneous Effects of Tariff and Non-tariff Trade-Policy Barriers in Quantitative General Equilibrium"

Peter H. Egger and Katharina Erhardt

The replication package for this paper is available at https://doi.org/10.5281/zenodo.10489950. The Journal checked the data and codes included in the package for their ability to reproduce the results in the paper and approved online appendices.