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The Differential Effects of Food Safety Regulations on Animal Products Trade: The Case of Crustacean Product Trade



Chloramphenicol is a broad-spectrum antibiotic that was historically used as a veterinary drug for farm animal disease treatment purposes and it is currently used in human treatment; however, this is a banned substance. This paper investigates the impact of advancing chloramphenicol analytical standards on crustacean imports in the EU15, Japan, and North America. The paper extends the work of Disdier and Marette (2010) by exploring the differential effect of standards on products. We use a Heckman sample selection specification to address zero trade at the product level. We show that submarkets function differently and respond differentially to the standard. Additionally, we show that the level of disaggregation matters in gravity modeling.