Abstract
Economic Effects of Rules of Origin. — Rules of origin exist because governments wish to discriminate amongst products on the basis of their “country of origin”. Since the components and activities that make up the total value added of many products are not created in a single location, rules to define a unique geographical source for products must be somewhat arbitrary, and inevitably introduce distortions into production and trade patterns as producers seek to provide their products with the most favourable origin. This paper considers the structure of such rules and their economic consequences.
Zusammenfassung
ökonomische Wirkungen von Ursprungsregeln. — Ursprungsregeln gibt es, weil Regierungen zwischen Produkten unterschiedlicher UrspungslÄnder diskriminieren wollen. Da die Bestandteile sowie die Be- und VerarbeitungsaktivitÄten, die über den Mehrwert der internationalen Güter entscheiden, oft nicht von einem einzigen Standort stammen, müssen Regeln, welche einen einheitlichen geographischen Ursprung von Produkten postulieren, einigerma\en willkürlich sein und unweigerlich Verzerrungen in die Produktions- und Handelsmuster hineinbringen, da die Produzenten bestrebt sind, ihre Produkte mit dem günstigsten Ursprung zu versehen. Die Verfasser untersuchen die Struktur solcher Regeln und ihre wirtschaftlichen Auswirkungen.
Similar content being viewed by others
References
Asakura, H. (1993). The Harmonized System and Rules of Origin.Journal of World Trade 27 (4): 5–21.
Corden, M. (1974).Trade Policy and Economic Welfare. Oxford: Clarendon Press.
Davidson, C., S. Matusz and M. Kreinen (1987). Analysis of Performance Standards for Direct Foreign Investments.Canadian Journal of Economics 28(4): 876–890.
Dixit, A. K., and G. M. Grossman (1982). Trade and Protection with Multistage Production.Review of Economic Studies 49(4): 583–594.
Falvey, R. E., and G. V. Reed (1997). Rules of Origin as Commercial Policy Instruments. Working Paper 1997-20. Economic Policy Research Unit, Copenhagen Business School.
Greenaway, D. G. (1992). Trade Related Investment Measures and Development Strategy.Kyklos 45 (2): 139–160.
Grossman, G. M. (1981). The Theory of Domestic Content Protection and Content Preference.Quarterly Journal of Economics 96(4): 583–603.
Ho, L.-S. (1997). Country of Origin Rules: Its Origin, Nature and Direction for Reform.Pacific Economic Review forthcoming.
Hoekman, B. (1993). Rules of Origin for Goods and Services: Conceptual Issues and Economic Considerations.Journal of World Trade 27 (4): 81–99.
Hufbauer, G. C., and J. J. Schott (1992). Rules of Origin. Chapter 8 in G. C. Hufbauer and J. J. Schott (eds.),North American Free Trade: Issues and Recommendations. Washington D. C.: Institute for International Economics.
Krishna, K., and M. Itoh (1988). Content Protection and Oligopolistic Interactions.Review of Economic Studies 55 (1): 107–125.
Krishna, K., and A. Krueger (1994). Implementing Free Trade Areas: Rules of Origin and Hidden Protection.
Krueger, A. O. (1993). Free Trade Agreements as Protectionist Devices: Rules of Origin. NBER Working Paper 4352. Cambridge, Mass.
— (1995). Free Trade Agreements versus Customs Unions. NBER Working Paper 5084. Cambridge, Mass.
Lloyd, P. J. (1993). A Tariff Substitute for Rules of Origin in Free Trade Areas.The World Economy 16 (6): 699–712.
Mussa, M. (1984). The Economics of Content Protection. NBER Working Paper 1457. Cambridge, Mass.
Richardson, M. (1991). The Effects of a Content Requirement on a Foreign Duopsonist.Journal of International Economics 31 (1/2): 143–155.
— (1993). Content Protection with Foreign Capital.Oxford Economic Papers 45(1): 103–117.
Shibata, H. (1967). The Theory of Economic Unions: A Comparative Analysis of Customs Unions, Free Trade Areas, and Tax Unions. In: C. S. Shoup (eds.), Fiscal Harmonization in Common Markets: Volume I, Theory. New York: Columbia University Press.
Vermulst, E. A. (1992). Rules of Origin as Commercial Policy Instruments — Revisited.Journal of World Trade 26 (6): 61–102.
Vousden, N. (1987). Content Protection and Tariffs under Monopoly and Competition.Journal of International Economics 23 (3/4): 263–282.
About this article
Cite this article
Falvey, R., Reed, G. Economic effects of rules of origin. Weltwirtschaftliches Archiv 134, 209–229 (1998). https://doi.org/10.1007/BF02708093
Issue Date:
DOI: https://doi.org/10.1007/BF02708093