A passage to India: Quantifying internal and external barriers to trade

• 成果类型: Article
• 署名作者: Van Leemput, Eva
• 署名单位: Federal Reserve System - USA; Federal Reserve System Board of Governors
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2021.103473
• 发表日期: 2021
• 关键词: Internal and external trade barriers; welfare; INDIA

摘要

This paper quantifies the size of internal versus external trade barriers and assesses the trade and welfare impact. I develop a quantitative two-sector international trade model featuring nonhomothetic preferences in which Indian states trade both domestically and internationally. I discipline the model using rich data on price dispersion together with state-based foreign and domestic trade flows. I find that (1) internal trade barriers make up 40% of total trade barriers on average, but vary substantially by state depending on the distance to the closest port; and (2) reducing trade barriers across Indian states to the United States level increases welfare more (13%) than removing international import barriers (7%). Published by Elsevier B.V.