WIFO Working Papers

Discussion papers by WIFO staff, consultants and guests – As of 2006 available online only – Free download

WIFO Working Papers are not peer reviewed and are not necessarily based on a coordinated position of WIFO. The authors were informed about the Guidelines for Good Scientific Practice of the Austrian Agency for Research Integrity (ÖAWI), in particular with regard to the documentation of all elements necessary for the replicability of the results.

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Gabriel Felbermayr (WIFO), Mario Larch, Erdal Yalcin, Yoto V. Yotov
On the Heterogeneous Trade and Welfare Effects of GATT/WTO Membership
WIFO Working Papers, 2022, (643), 48 pages
Online since: 18.02.2022 0:00
We quantify the partial and general equilibrium effects of GATT/WTO membership on trade and welfare. Using an extensive database covering manufacturing trade for 186 countries over the period 1980-2016, we find that the average impact of GATT/WTO membership on trade among member countries is large, positive, and significant. We contribute to the literature by estimating country-specific estimates and find them to vary widely across the countries in our sample with poorer members benefitting more. Using these estimates, we simulate the general equilibrium effects of GATT/WTO on welfare, which are sizable and heterogeneous across members, and relatively small for non-member countries. We show that countries not experiencing positive trade effects from joining GATT/WTO can still gain in terms of welfare, due to lower import prices and higher export demand.
JEL-Codes:F1, F13, F14
Keywords:GATT, Welfare, Heterogeneous Policy Effects, WTO
Research group:No Research Group affiliation