Methods to Aggregate Import Tariffs and their Impacts on Modeling Results

Methods to Aggregate Import Tariffs and their Impacts on Modeling Results

When impacts of WTO market access proposals are analyzed with economic trade models, it is necessary to aggregate tariff data from the detailed tariff line level to the model level. In this article import tariffs and implemented import tariff cuts are aggregated from the HS6-digit tariff line level with the simple and trade weighted average, the Trade Restrictiveness Index (TRI) and the Mercantilist Trade Restrictiveness Index (MTRI) by considering bound and applied tariff rates. The resulting tariffs are substituted for the originally applied import tariffs of the GTAP data base. Multilateral trade liberalization scenarios are then implemented and the welfare effects are compared.