Date of Award
Spring 5-2-2025
Document Type
Thesis
Degree Name
Master of Arts (MA)
Department
Economics
First Advisor
Armen Khederlarian
Second Advisor
Jonathan Conning
Academic Program Adviser
Karna Basu
Abstract
This thesis examines how economic theory can explain differences in preferential access across products. Preferential access is the difference between the preferential tariff and the most favored nation (MFN) tariff. This research applies the theory from Bagwell and Staiger (1990) and the empirical findings from Bown and Crowley (2013) to tariff, import flow, import demand, and export supply elasticity data, where Chile is the reporting country. The two-way fixed effects linear regression estimates how changes in import growth, the volatility of import growth, and the inverse sum of import demand and export supply elasticities affect preferential access. The estimates indicate that the Bagwell and Staiger theory explains preferential access in Chile. Specifically, there is a negative statistically significant relationship between preferential access and import growth, a positive statistically significant relationship between preferential access and the standard deviation of import growth, and a negative statistically significant relationship to the inverse sum of elasticities. Additionally, the model of cooperative tariff rate setting does not explain preferential access for all Latin American countries because the model fails for Ecuador and Brazil.
Recommended Citation
Sanchez, Kristie-Marie, "The Economic Drivers of Preferential Access" (2025). CUNY Academic Works.
https://academicworks.cuny.edu/hc_sas_etds/1373
