The role of technical standards for trade between China and the European Union

Abstract

The paper addresses the role of technical standards in bilateral trade relationship between the European Union (EU) and China. Traditional aggregate demand functions for imports and exports have been applied to estimate the effects of national and international standards. The panel dataset covers 14 years (1995–2008) and 36 two-digit technological fields based on the International Classification of Standards (ICS). The results indicate negative effects of purely national Chinese standards but positive effects of Chinese international standards for European exports. European standards and European standards aligned with international standards have a positive impact on exports and imports. Based on these results, we conclude that both China and the EU should increase their efforts to harmonise national standards.

Keywords:

• technical barriers to trade
• standards
• panel analysis
• standardisation policy

Acknowledgements

This paper draws upon research conducted under the China EU Information Technology Standards Research Partnership. This was a support action partly funded under the European FP7 Socio-economic Sciences and the Humanities programme, topic SSH-2007-8.2 under Grant Agreement No. 217457.

Notes

http://www.wto.org/english/tratop_E/tbt_e/tbt_info_e.htm#agree1

http://www.sac.gov.cn/templet/english/

http://www.wto.org/english/docs_e/legal_e/17-tbt.pdf

Weeks and Chan (2003) claim that a large proportion of these international aligned standards are modified versions of the original international standards. However, the SAC database does not allow access to full texts, so we cannot verify this argument.

For other approaches using instrumental variables see for example Shepherd (2007).

The respective STATA commands are -xtpcse, corr(i)- for the former and -xtpcse, corr(ar) for the latter.