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Protection and Performance


  • Miriam Manchin would like to acknowledge the financial support received from the European Commission under the Marie Curie Intra-European Fellowship Programme. Particular thanks are due to Jeff Bergstrand, Peter Neary, Doug Nelson, and Alan Woodland for constructive comments and encouragement, as well as Will Martin, Peter Egger, Eddy Bekkers, and participants in assorted sessions at the Econometric Society meetings, the European Trade Study Group, UCL, the Tinbergen Institute, and CEPR. We would also like to thank Paulo Guimaraes for helpful suggestions on methodological issues.


We examine the linkages between import policy and export performance, extending classic macroeconomic trade effects to more recent concepts from the modern literature on gravity models. We also examine these effects empirically with a panel of global and bilateral trade spanning 15 years. Our emphasis on the role of import policy (i.e. tariffs) of exporters as an explanation of trade volumes contrasts with the recent emphasis on importer policy in the gravity literature. It also reinforces the growing body of evidence on the importance of economic environmental (policy and infrastructure) conditions in explaining relative export performance and is in line with the literature on global value chains.