Export Performance and Trade Facilitation Reform: Hard and Soft Infrastructure

62 Pages Posted: 20 Apr 2016

See all articles by Alberto Portugal-Perez

Alberto Portugal-Perez

World Bank

John S. Wilson

World Bank - Development Research Group (DECRG)

Date Written: April 1, 2010

Abstract

The authors estimate the impact of aggregate indicators of "soft" and "hard" infrastructure on the export performance of developing countries. They build four new indicators for 101 countries over the period 2004-07. Estimates show that trade facilitation reforms do improve the export performance of developing countries. This is particularly true with investment in physical infrastructure and regulatory reform to improve the business environment. Moreover, the findings provide evidence that the marginal effect of infrastructure improvement on exports appears to be decreasing in per capita income. In contrast, the impact of information and communications technology on exports appears increasingly important for richer countries. Drawing on estimates, the authors compute illustrative exports growth for developing countries and ad-valorem equivalents of improving each indicator halfway to the level of the top performer in the region. As an example, improving the quality of physical infrastructure so that Egypt's indicator increases half-way to the level of Tunisia would increase exports by 10.8 percent. This is equivalent to a 7.4 percent cut in tariffs faced by Egyptian exporters across importing markets.

Keywords: Environmental Economics & Policies, Transport Economics Policy & Planning, Free Trade, Economic Theory & Research, Trade Policy

Suggested Citation

Portugal-Perez, Alberto and Wilson, John S., Export Performance and Trade Facilitation Reform: Hard and Soft Infrastructure (April 1, 2010). World Bank Policy Research Working Paper No. 5261, Available at SSRN: https://ssrn.com/abstract=1585040

Alberto Portugal-Perez (Contact Author)

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

John S. Wilson

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

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