Deep Trade Policy Options for Armenia : The Importance of Services, Trade Facilitation and Standards Liberalization

This paper develops an innovative 21 sector computable general equilibrium model of Armenia to assess the impact on Armenia of a Deep and Comprehensive Free Trade Agreement with the European Union, as well as further regional or multilateral trade policy commitments. The analysis finds that such an agreement with the European Union will likely result in substantial gains to Armenia, but shows that the gains derive from the deep aspects of the agreement. In order of importance, the sources of the gains are: (i) trade facilitation and reduction in border costs; (ii) services liberalization; and (iii) standards harmonization. A shallow agreement with the European Union that focuses only on preferential tariff liberalization in goods will likely lead to small losses to Armenia primarily due to a loss of productivity from lost varieties of technologies from the rest of the world region in manufactured products. Additional gains can be expected in the long run from an improvement in the investment climate. The authors estimate only small gains from a services agreement with countries of the Commonwealth of Independent States, but significant gains from expanding services liberalization multilaterally.

Bibliographic Details

Main Authors:	Jensen, Jesper, Tarr, David G.
Language:	English
Published:	2011-05-01
Subjects:	ADVANCED COUNTRIES, AGRICULTURE, AIR, AIR TRANSPORT, BANKING SERVICES, BASE YEAR, BENCHMARK, BENCHMARK EQUILIBRIUM, CAPITAL GOOD, CAPITAL STOCK, CENTRAL ELASTICITY, COMMODITIES, COMMODITY, COMPARATIVE ADVANTAGE, COMPETITIVENESS, CONSTANT ELASTICITY OF TRANSFORMATION, CONSTANT RETURNS TO SCALE, COST REDUCTION, COST STRUCTURE, COST STRUCTURES, COUNTRY OF ORIGIN, CUSTOMS UNION, DEMAND CURVE, DEMAND CURVES, DEVELOPING COUNTRIES, DEVELOPING COUNTRY, DEVELOPMENT ECONOMICS, DEVELOPMENT INTENSITY, DEVELOPMENT POLICY, DOMESTIC MARKET, DOMESTIC PRODUCTION, ECONOMETRIC ESTIMATES, ECONOMIC FEASIBILITY, ECONOMIC GEOGRAPHY, ECONOMIC IMPLICATIONS, ECONOMIC INTEGRATION, ECONOMIC PERFORMANCE, ECONOMIC REFORM, ECONOMIC RESEARCH, ECONOMIC THEORY, ECONOMICS LITERATURE, ELASTICITIES, ELASTICITY, ELASTICITY OF DEMAND, ELASTICITY OF SUBSTITUTION, ELASTICITY OF SUPPLY, ELASTICITY VALUES, EQUILIBRIUM, EXPORT MARKETS, EXPORTERS, EXPORTS, EXTERNALITIES, EXTERNALITY, FACTORS OF PRODUCTION, FEDERAL RESERVE, FEDERAL RESERVE BANK, FINANCIAL SUPPORT, FIRM PERFORMANCE, FIXED RATE, FOOD INDUSTRY, FOREIGN DIRECT INVESTMENT, FOREIGN FIRMS, FOREIGN GOODS, FOREIGN INVESTMENT, FOREIGN OWNERSHIP, FREE ACCESS, FREE TRADE, FREE TRADE AGREEMENT, FREE TRADE AGREEMENTS, GDP, GENERAL EQUILIBRIUM ANALYSIS, GENERAL EQUILIBRIUM MODEL, GLOBAL INTEGRATION, GLOBALIZATION, GROSS DOMESTIC PRODUCT, HARMONIZATION, IMPERFECT COMPETITION, IMPORT DUTIES, INCOME, INCOMES, INCREASING RETURNS, INCREASING RETURNS TO SCALE, INSPECTION, INSURANCE, INTERMEDIATE GOODS, INTERMEDIATE INPUTS, INTERNATIONAL AGREEMENT, INTERNATIONAL COMPETITIVENESS, INTERNATIONAL NEGOTIATIONS, INTERNATIONAL TRADE, INVESTMENT BARRIERS, INVESTMENT CLIMATE, KNOWLEDGE SPILLOVERS, LAND TRANSPORT, LEGAL FRAMEWORK, LESS DEVELOPED COUNTRIES, LOCALIZATION, LOSS OF TARIFF REVENUE, MANUFACTURING INDUSTRY, MANUFACTURING PRODUCTIVITY, MARGINAL COST, MARGINAL COSTS, MARGINAL PRODUCT, MARGINAL REVENUE, MARKET ACCESS, MARKET SHARE, MARKET SHARES, MONOPOLISTIC COMPETITION, MULTILATERAL TRADE, MULTINATIONAL FIRMS, OPEN ECONOMIES, OPEN ECONOMY, OPENNESS, OPTIMAL TARIFFS, OPTIMIZATION, OUTPUT, PREFERENTIAL AGREEMENT, PREFERENTIAL AGREEMENTS, PREFERENTIAL REDUCTION, PREFERENTIAL TARIFF, PREFERENTIAL TRADE, PREFERENTIAL TRADE AGREEMENTS, PREFERENTIAL TRADE AREAS, PRICE INDEX, PRIMARY FACTORS, PRIMARY FACTORS OF PRODUCTION, PRODUCT DIFFERENTIATION, PRODUCTION COSTS, PRODUCTION FUNCTION, PRODUCTIVITY, PRODUCTIVITY GROWTH, PRODUCTIVITY INCREASES, RAILROAD, RAILWAY, RAILWAYS, RATE OF RETURN, RATE OF RETURN ON CAPITAL, REAL ESTATE, REDUCTION OF BARRIERS, REGIONAL INTEGRATION, REGIONAL TRADE, REGIONAL TRADE AGREEMENTS, REGIONALISM, REGULATORY BARRIERS, REGULATORY ENVIRONMENT, REGULATORY REGIMES, RETURNS TO SCALE, ROAD TRANSPORT, RULES OF ORIGIN, SAFETY, SINGLE MARKET, SMALL COUNTRIES, SUPPLY CURVE, SUPPLY CURVES, TARIFF BARRIERS, TARIFF DATA, TARIFF EQUIVALENCE, TARIFF PREFERENCES, TARIFF PROTECTION, TARIFF RATE, TARIFF RATES, TARIFF REDUCTION, TARIFF REVENUE, TAX, TECHNOLOGY TRANSFER, TELECOMMUNICATIONS, TERMS OF TRADE, TERMS OF TRADE EFFECTS, THIRD WORLD, TOTAL FACTOR PRODUCTIVITY, TRADE BARRIERS, TRADE DATA, TRADE DIVERSION, TRADE DIVERSION COSTS, TRADE FACILITATION, TRADE FLOW DATA, TRADE LIBERALIZATION, TRADE PARTNERS, TRADE PATTERNS, TRADE POLICY, TRADE REFORM, TRANSITION ECONOMIES, TRANSMISSION OF KNOWLEDGE, TRANSMISSION OF TECHNOLOGY, TRANSPORT, TRANSPORT ACTIVITIES, TRANSPORT SERVICES, TRANSPORTATION, TRANSPORTATION COSTS, TRANSPORTATION SERVICES, TRUCKS, TRUE, UNIFORM TARIFFS, UNILATERAL LIBERALIZATION, UNILATERAL REFORM, URUGUAY ROUND, VARIABLE COSTS, VEHICLE, WELFARE GAINS, WELFARE IMPACTS, WELFARE LOSS, WORLD ECONOMY, WORLD INVESTMENT REPORT, WORLD TRADE, WORLD TRADE ORGANIZATION, WTO, ZERO PROFITS, ZERO TARIFFS,
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20110518082525 https://hdl.handle.net/10986/3425
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