Paola Conconi, Manuel García-Santana, Laura Puccio, Roberto Venturini, 16 March 2016

One of the more pernicious barriers to trade in today's world are so-called 'rules of origin' that should help customs officers determine a product's origin, but often serve to raise the cost of importing. In practice, such rules prevent final producers from choosing the most efficient input suppliers around the world. This column investigates the impact of rules of origin in the world's largest free trade agreement, NAFTA, on imports of intermediate goods from non-member countries. The findings show that preferential rules of origin in FTAs can violate GATT rules by substantially increasing the level of protection faced by non-members.

Jamal Ibrahim Haidar, 09 April 2013

The US and EU have imposed severe trade sanctions on Iran. This column uses Iranian exporter-level customs data to show that many Iranian exporters have successfully diverted trade from the US and EU to Asian, African, and Latin American destinations.

James Anderson, Yoto Yotov, 19 May 2011

Free trade agreements are controversial. While they promote trade between the member countries, they may also divert trade away from non-member countries, potentially reducing welfare. This column provides evidence that, even when trade diversion is taken into account, the overall effects are still strongly positive.

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