Monthly Archives: December 2009

What explains tariff levels?

It’s not economic policy (or even necessity) as much as the political economy that drives trade policies.

“The relationship between the overall tariff policy (considering all product groups together) and the socio-economic variables is even more diffuse, and no strong relationship emerges between tariff policy clusters and the socio-economic context. Consequently, we can conclude that trade policy is not over-determined by economic considerations: the decision-making process defining a precise trade policy is the result of more complex interactions.” Extract from Mapping the Tariff Waters by Diakantoni and Escaith (WTO Economic Research Division)
A plausible, even unexciting, conclusion. But an interesting mapping of global tariff data.