00:00 So welcome everybody.
00:01 This is,
00:02 I think,
00:02 um,
00:03 The 3rd
00:05 of our seminar series for the World Development Report
00:08 on Standards for Development.
00:11 And uh today we have uh Camille
00:14 Reberti
00:16 I,
00:16 I pronounce it correctly
00:19 uh Camille is a postdoc.
00:21 She has a postdoc position at the
00:24 at the graduate uh institute in Geneva.
00:27 And she's been working on
00:30 On,
00:30 um,
00:31 standard related issues to,
00:33 to trade,
00:34 um,
00:35 and,
00:36 um,
00:37 we asked her to do a bit of an unconventional presentation
00:41 where
00:42 she will present,
00:43 um,
00:45 uh,
00:45 two papers,
00:46 two different papers,
00:47 so we will have a bit of a break from one to the other,
00:50 but
00:51 very much related to,
00:53 uh,
00:53 the impact of standards around trade.
00:56 The first one is on protection,
00:59 our protectionism,
01:00 the effect of technical regulations on input sourcing.
01:03 And the second one is about adopting voluntary standards.
01:08 Uh,
01:09 so it's two different topics but very much related to,
01:12 to the impacts of of standards
01:14 on trade.
01:15 We let her.
01:17 To present for 45 minutes,
01:19 uh,
01:19 please,
01:19 if you have any questions,
01:21 uh,
01:22 clarification questions first,
01:24 we can,
01:25 you can do it or send it on the,
01:27 put it on the text box,
01:28 uh,
01:29 but otherwise we'll might make sure that we have a good 15 minutes or more
01:33 for Q&A
01:34 at the end,
01:36 OK?
01:37 So thanks Camille for doing this and,
01:39 uh,
01:39 over to you.
01:41 Um,
01:41 thank you very much.
01:42 So,
01:42 good morning,
01:43 everyone.
01:43 Um,
01:43 I'm really happy to be here and present,
01:46 um,
01:47 Today,
01:48 so as um Chavi mentioned,
01:49 today I'm gonna present two different papers.
01:52 So the presentation,
01:53 um,
01:53 it's called Navigating Standards,
01:55 The Impact of Technical Regulations and Voluntary Certifications
01:59 for firms trade um strategies.
02:05 So as I'm sure you're all aware,
02:06 global trade is nowadays increasingly shaped by standards
02:11 such as non-tariff measures and voluntary standards.
02:15 These different measures can enhance product quality and consumer trust,
02:20 but they may also create some barriers to trade,
02:24 despite their either voluntary or non-discriminatory nature.
02:30 So as a result,
02:32 understanding how such rules and regulations affect firms.
02:37 Decisions,
02:38 behavior,
02:38 input sourcing decisions,
02:40 or more trade performance in general is essential.
02:44 And um in this presentation,
02:47 I'm gonna focus on,
02:49 I'm going to present two different papers.
02:50 So the first one is gonna
02:53 be on the effect of
02:55 uh technical biers to trade,
02:57 and the second one is going to focus more on um
03:00 voluntary standards.
03:02 Um.
03:03 So we're a bit
03:05 They are a bit different,
03:07 um,
03:07 as one is mandatory,
03:08 whereas the other one is voluntary,
03:10 but I think,
03:11 um,
03:11 they sort of complement each other in,
03:14 in a way of,
03:15 um,
03:16 understanding more globally how um
03:18 different types of regulation works and affects them.
03:23 Um,
03:24 so I'm gonna start with the first paper that
03:25 looks at the effects of technical virus trade,
03:28 and then I'll move on to the second paper.
03:32 So,
03:32 we,
03:33 we started working on um the first chapter.
03:35 So,
03:36 um,
03:37 bear in mind these figures might change a bit now that uh with the new
03:42 Trump tariff,
03:42 but,
03:43 um,
03:43 at least up to recent years,
03:46 um,
03:46 we observed a large decrease in tariff protection.
03:50 Um,
03:51 all over the world and it's even more
03:54 true when we distinguish between type of products.
03:56 So if you look here at the blue line,
03:58 you can see
03:59 that's even more stringent for um intermediate good where the um,
04:05 The tariff rate is even lower than for
04:08 for the average product.
04:10 On the other hand,
04:11 if we look at a similar picture before technical barriers to trade instead,
04:16 we can see that they have been over the same period,
04:19 they have been growing.
04:21 And again,
04:21 if we look at the blue line,
04:23 um,
04:24 it's even more striking for intermediate goods.
04:27 So here,
04:27 um,
04:28 you have the three different types of products and
04:32 you can see the largest increase are the,
04:35 the products that have been targeted the
04:37 most by technicalvis trade or intermediate goods.
04:43 Um,
04:44 before going a bit,
04:45 um,
04:45 deeper into the presentation,
04:47 just a quick reminder of what,
04:48 um,
04:49 technical barriers to trade is.
04:51 Um,
04:51 so,
04:51 TBTs are all the technical standards
04:54 that differs from international one and might,
04:57 might therefore impact trade.
04:59 Um,
05:00 to give you a more concrete example,
05:02 part of the new Green Deal,
05:04 the EU imposed a TPT on
05:07 batteries
05:08 and accumulators.
05:11 And
05:12 where
05:13 In the regulations,
05:15 if you want to use batteries,
05:17 you have the EU impose requirements on the
05:22 The,
05:24 uh,
05:24 level of hazardous materials that have been using.
05:28 The level of um
05:31 Of recycled materials that I have been using,
05:34 and as you can see in the pictures,
05:35 the batteries are um
05:38 Widely used in different types of products.
05:40 So it could be for electric vehicles,
05:42 it could be for photovoltaic,
05:45 um,
05:45 products,
05:46 etc.
05:46 So,
05:47 um,
05:47 one specific activities might
05:49 have a more global effect on across different,
05:53 um,
05:53 supply chains.
05:56 So,
05:56 what we are interesting in this paper and what we want to look at is,
06:00 um,
06:01 so do TBTs
06:03 cause a diversion of supply chains
06:05 and what could be the drivers um of these GVC disruptions?
06:10 So,
06:11 unlike tariffs,
06:12 standards are non-discriminatory,
06:14 uh,
06:14 but they might have different effects on trade.
06:18 So,
06:18 first,
06:18 um,
06:19 the TBTs might reduce information of
06:22 information asymmetries.
06:23 Um,
06:24 either about the quality of the product or,
06:27 um,
06:28 about whether the product is safe to use.
06:31 And in that case,
06:33 it might thus increase international sourcing.
06:36 However,
06:36 on the other hand,
06:38 um,
06:38 TBTs codify different technology that,
06:41 uh,
06:41 foreign firms might not have access to or might have
06:44 access to other higher costs than dome domestic firms.
06:48 And in that case,
06:49 we would observed a decrease in international sourcing.
06:53 Um,
06:54 so what we wanna do and what I wanna show you is,
06:56 um,
06:57 what could be the effect of a TBT.
07:01 Um,
07:02 so,
07:02 the
07:03 main contribution of this paper are threefold.
07:06 Um,
07:06 so first,
07:06 to answer this question,
07:07 we're gonna create,
07:08 we created a new database that covers all the different,
07:12 um,
07:12 TBTs that have been notified,
07:15 uh,
07:15 between 1995 and 2019.
07:19 We're going to use product trade flows to estimate the effect
07:22 of a TBT on the share of EU import sourcing.
07:26 And
07:27 But,
07:28 um,
07:29 we also include a more vertical mechanisms which I would not go,
07:32 um,
07:33 too
07:34 deep into details,
07:35 um,
07:35 for this plantation,
07:36 but the idea that we have is we're gonna incorporate
07:40 adaptation costs,
07:41 um,
07:41 to the TBT into a model of sourcing.
07:45 Um,
07:46 we're also going to create a new measure,
07:48 um,
07:48 using text analysis techniques.
07:51 Uh,
07:51 we're going to
07:52 offer a new measure of adaptation cost,
07:55 and we're going to rely on French custom data,
07:58 um.
08:00 To show evidence of the microeconomic mechanisms of sourcing decisions.
08:09 Um,
08:10 So to give you an idea of how it works,
08:12 um,
08:13 and of the institutional framework of WTO,
08:16 um,
08:17 sorry,
08:17 of TBT,
08:18 um,
08:18 so at the multilateral,
08:20 multilateral levels,
08:21 um,
08:22 all the WTO members have signed the TBT agreements in 1995,
08:27 and in
08:27 these agreements,
08:28 they agreed to notify to the WTO all the
08:32 technical standards that differs from the international ones.
08:36 At a more regional level,
08:38 um,
08:39 the EU has signed several PTAs with deep integration clauses.
08:45 And in that case we're going to be interested in whether the EU
08:49 has signed trade agreements which includes a clause on either harmonization of TBT
08:56 or mutual recognition of TBTs.
09:00 And even within the EU there are two different regimes,
09:04 so around 70% of the production in the EU is within a harmonized sector,
09:10 where in that case all the standards and all the
09:12 rules and regulations are harmonized across all the EU members.
09:17 But you also have the 30% remaining of the EU
09:21 production that is in the non-harmonized or partly harmonized sector,
09:26 which in that case,
09:27 only mutual recognition applies across the EU members.
09:36 Um,
09:36 so,
09:36 as I mentioned in the introduction,
09:38 um,
09:39 we're gonna use,
09:40 um,
09:40 several
09:41 types of,
09:41 um,
09:42 data.
09:43 The first one is,
09:45 um,
09:45 the new database that we created on all the
09:48 different TBTs that have been notified to the WTO.
09:51 So we collected information on around 30,000,
09:55 um,
09:55 TBTs around,
09:56 uh,
09:57 between 1995 and 2019.
09:59 Um,
10:00 however,
10:00 out of this,
10:01 um,
10:01 30,000 TBTs,
10:04 around 40.
10:05 8% have no um
10:08 product information.
10:10 So,
10:10 we implemented the multi-step
10:12 procedures to recover the product information.
10:14 So either we're gonna use um different sources,
10:17 so we're going to look into the indemned,
10:19 the notifications,
10:20 different official documents.
10:22 Um,
10:23 we're going to match the ICS to the HS codes,
10:26 um,
10:26 and in the last step,
10:27 we're gonna use a machine learning algorithm.
10:30 Um,
10:31 to have,
10:32 uh,
10:32 using the desk text descriptions,
10:35 um,
10:36 to match
10:37 a certain notification to a certain,
10:39 um,
10:40 product information.
10:43 And,
10:43 then on the more regional level,
10:45 we're going to use the World Bank database on provincial trade agreements and um.
10:51 To have information on
10:54 um
10:54 DBT clauses that are included in the trade agreements.
10:58 And
10:59 for within the EU we're gonna use um
11:02 data from the EU Commission that give us
11:04 the list of non-harmonized sectors to distinguish between the
11:08 products that are fully harmonized and the products
11:10 that are not fully harmonized within the EU.
11:14 Um,
11:15 and finally,
11:15 we're gonna use,
11:16 um,
11:17 French firm level data,
11:19 um,
11:20 which allow us to have,
11:22 uh,
11:22 to use a firm level definition of intermediate goods.
11:25 So,
11:25 we're gonna define an intermediate good as a good that is imported,
11:29 um,
11:31 And that is um
11:33 in a different
11:34 HS codes than the core business of the firm.
11:39 Um,
11:39 with the idea of,
11:41 um,
11:42 A different product may be an input for a firm,
11:45 but might,
11:45 might also be,
11:47 um,
11:48 a main export for the firm.
11:49 So,
11:49 we wanted to distinguish between
11:51 a firm that is going to import,
11:53 um,
11:54 specific products for its,
11:56 uh,
11:56 for its production versus,
11:59 um,
11:59 a firm
12:00 that is going to use this product as its main exports.
12:06 Um,
12:08 So,
12:08 if we look at the aggregate level,
12:11 um,
12:12 what we can see is,
12:13 um,
12:14 so if we look at the effects of a TBT imposed by the EU on the share of EU
12:19 that is sourced from within the EU.
12:22 We can see
12:25 activity increases the share of imports that is source within the EU.
12:30 However,
12:31 if we look at the effect for intermediate goods,
12:33 uh,
12:33 we observe that this is only 1/4 of the effects.
12:37 Um,
12:38 so it suggests that sourcing links are
12:40 harder to substitute for intermediate goods.
12:46 Um,
12:47 so just
12:48 one quick slide on the theoretical mechanisms and what we have in mind.
12:52 Um,
12:54 so we decided
12:55 to add,
12:56 um,
12:56 the introduction of a TBT into a source model.
13:00 And here,
13:01 what we have in mind is
13:03 a given TBT
13:04 is going to require um suppliers to adapt their production.
13:07 So if um
13:10 A given country or a given supplier still want to export to the EU.
13:15 They're going to have to adapt that production
13:17 to make sure that they fulfill the new requirements imposed by the EU.
13:21 And um
13:23 we think this adaptation cost is going to
13:26 be country specific and it's going to depend
13:29 on how similar or dissimilar your
13:32 production or your,
13:33 or the regulation in your country or from
13:36 the ones in the EU.
13:38 And um this adaptation cost is going to affect
13:42 the input prices directly through an increase in the unit cost,
13:46 but also indirectly
13:49 through an outside option.
13:51 Um,
13:52 so what we have in mind with this,
13:54 um,
13:55 vertical mechanisms is,
13:57 um,
13:59 So if we assume that um supply chains were previously located in Country A,
14:04 um,
14:05 now we're gonna be interested in whether um
14:08 the country in you,
14:09 in which you imports from.
14:11 It's gonna change um
14:13 following the introduction of a DBT.
14:16 Um,
14:17 so if
14:18 the
14:19 wage in country A,
14:21 um,
14:22 that is now taking into account,
14:24 um,
14:24 it uh,
14:25 so our adaptation costs to the TBT is still lower than the wage,
14:29 um,
14:29 in Country B.
14:31 We,
14:32 um,
14:33 we expect no change in the supplier origin,
14:35 but we're still gonna,
14:36 um,
14:38 um.
14:40 Still think they're gonna be an effect on the prices.
14:44 Um,
14:44 however,
14:45 if now
14:46 the wage,
14:47 uh,
14:47 that includes the adaptation costs
14:49 in Country B becomes smaller,
14:52 um,
14:52 than the one in Country A,
14:54 we now,
14:54 um,
14:55 accept,
14:56 um,
14:56 expect,
14:57 expect,
14:58 uh,
14:58 ships from suppliers from Country A to Country B.
15:02 Um,
15:06 Um,
15:06 so,
15:07 to answer this question,
15:09 Um,
15:10 the research designs we're going to have is,
15:12 so first we're going to look at different firms' import margin.
15:17 So we're going to look at import expenditure and import prices.
15:22 And on the more supply chains reallocation side effects,
15:26 we're also going to look at the effects on
15:28 quantity,
15:29 entry and exit.
15:32 And
15:33 the way we're going to do it is,
15:35 so our first variable of interest is going to be TBT,
15:38 which is going to be equal to one,
15:40 if the EU introduced a new TBT on a given product at a given
15:45 time.
15:47 And then we're gonna look at um
15:50 Whether this effect is different depending on the adaptation cost.
15:54 So it's a
15:56 Um,
15:56 TPT.
15:57 We're gonna measure our EA TPT in two different ways.
16:00 So the first one,
16:01 the first way we're going to do it is to,
16:04 yes.
16:05 I mean,
16:05 sorry,
16:06 sorry,
16:06 can,
16:07 can we ask questions?
16:08 Sorry,
16:08 I,
16:08 I'm,
16:08 I'm not sure,
16:10 yeah,
16:10 yeah,
16:11 OK,
16:11 so,
16:11 so sorry,
16:12 just a quick point here.
16:13 So,
16:14 uh,
16:14 so TDT.
16:16 Um,
16:16 you know,
16:17 basically setting,
16:18 uh,
16:18 a TBT,
16:19 the EU introducing a new TBT is,
16:20 is
16:22 I mean,
16:22 there's a reason why they might do that,
16:23 right?
16:24 So,
16:24 so,
16:25 uh,
16:25 so,
16:26 you know,
16:27 maybe they want to protect,
16:28 maybe they want to,
16:30 uh,
16:30 I don't know,
16:30 maybe there's a,
16:32 uh,
16:32 uh,
16:32 uh,
16:33 you know,
16:33 safety scare and so they,
16:35 they,
16:35 they,
16:36 so,
16:38 So,
16:38 so I guess,
16:38 you know,
16:39 are you dealing with,
16:40 with this potential endogeneity or,
16:42 or are you gonna tell us,
16:44 uh,
16:45 uh,
16:45 you know,
16:45 whether these,
16:46 you know,
16:46 DBTs tend to be introduced in cert at certain times in certain sectors?
16:50 Uh,
16:52 yeah,
16:52 um,
16:53 yeah,
16:53 what,
16:53 what's your,
16:54 what's your take on that?
16:54 I mean,
16:55 so,
16:55 this is like,
16:56 you know,
16:56 they're exhaustionously uh given,
16:58 but,
16:58 but clearly they're not,
17:00 right?
17:00 So,
17:01 yeah,
17:01 so.
17:04 Um,
17:05 so one way we have of dealing with this is,
17:08 um,
17:09 so sometimes when they notify the TPT to the WTO,
17:13 they also give an objective of the measure,
17:15 and we also look at whether the effect is still there
17:19 if we control for
17:21 either if the TPT as an objective of harmonization.
17:26 Of,
17:27 of trade enhancing,
17:29 um,
17:31 Um,
17:31 and there we still have our
17:34 negative effect of the other
17:36 TBTs.
17:37 Um,
17:39 we try to look at,
17:40 um,
17:41 The different effects by different um objectives of the TBT,
17:46 um.
17:48 We also found,
17:49 um,
17:50 so I'm not sure I put it on the slides,
17:51 but even if the objective is protection of the environment or,
17:55 um,
17:56 organic certification,
17:58 something like this,
17:59 um,
17:59 the effect is also sometimes negative.
18:02 Um,
18:03 So,
18:04 the one we looked at were more whether the objective was trade enhancing,
18:08 harmonization,
18:10 um,
18:12 But we also found,
18:13 I think when we looked at either
18:15 uh either protection of the environment or consumer protection,
18:19 I think it was also one objective,
18:21 and there the effect was still
18:23 negative.
18:25 And,
18:25 and sorry,
18:25 just a,
18:26 a related point here.
18:27 So,
18:28 so TPTs now are,
18:29 are,
18:30 are sort of dummy,
18:31 dummy measures,
18:32 but,
18:32 but there could be
18:34 You know,
18:35 there could be,
18:35 uh,
18:36 you know,
18:37 these changes could be quite different,
18:38 right?
18:39 Relative to what,
18:39 uh,
18:40 what the,
18:41 what the standard was,
18:42 uh,
18:43 before the,
18:43 this introduction,
18:44 right?
18:44 I mean,
18:44 so,
18:45 so it could be a big jump,
18:46 jump or it could be a smaller,
18:48 a smaller jump so that,
18:50 so,
18:51 so that,
18:51 you know,
18:51 the,
18:52 the,
18:52 the costs for compliance,
18:55 the compliance caused by the,
18:56 by the exporter,
18:57 uh,
18:57 could be,
18:58 could be quite different.
18:59 So,
19:00 Yeah,
19:00 so,
19:01 uh,
19:01 uh,
19:01 yeah,
19:01 are you,
19:02 are you looking at that or,
19:04 or that's maybe not a relevant margin?
19:06 Yeah,
19:06 what,
19:07 what,
19:07 what,
19:07 what,
19:07 what do you,
19:08 what do you think?
19:09 Um,
19:10 so,
19:10 in the baseline,
19:11 we use a dummy.
19:13 One robustness check that we do is to use account numbers.
19:16 So if a product is targeted by
19:19 10 TBTs that might be different than if it's only 2.
19:22 So that's one thing we do.
19:24 Um,
19:24 and then on the slide afterwards,
19:26 I'll show you how we measure this adaptation cost.
19:29 And the way we do it is to compare,
19:32 um,
19:32 the regulations,
19:33 the newly regulation that is introduced versus,
19:37 um,
19:37 the regulations that is in place in the country,
19:41 um.
19:44 Maybe one additional thing we could do is to compare.
19:49 In between the EU regulations,
19:51 cause I think that's what you meant,
19:53 so,
19:54 um,
19:56 Yeah,
19:57 that's something we haven't looked at.
19:58 So,
19:59 we checked
20:00 every new regulations,
20:01 how different it is from
20:03 what is applied,
20:04 but not
20:05 how different the new one is compared to the other one.
20:10 Um,
20:11 I think we tried to do it.
20:13 So instead of,
20:13 uh,
20:14 comparing the new ones to the one that is in place,
20:16 we also compare
20:18 the,
20:19 all the EU measures,
20:21 including the new ones to everything.
20:23 Um,
20:23 and I think the results were quite similar.
20:31 Or maybe we could look a bit more specific into changes in between the regulations,
20:37 in between duties.
20:46 OK.
20:47 Um,
20:49 So the first way we measure the adaptation cost is to compare um
20:55 the effect the effect that TBT is gonna have um
20:58 within the EU compared to outside of the EU.
21:01 We have the idea of um
21:04 The EU suppliers might have more um incentive to
21:09 Uh,
21:09 to comply with the new regulations because even if
21:12 they only want to serve the domestic market,
21:14 they have to,
21:15 um,
21:16 comply with the new regulations versus
21:18 an extra EU suppliers,
21:20 um,
21:21 depending on how big the EU market represents,
21:24 might not be willing to,
21:26 um,
21:26 implement the new standards.
21:29 And the second way we're going to measure our adaptation cost is to look at
21:36 how dissimilar the
21:39 The regulation in the EU is compared to the
21:42 regulation in the country you want to import from.
21:45 So here to give you an example,
21:46 um,
21:47 we're gonna compare,
21:48 so,
21:49 let's say TBT3 is the new EU TBT that is imposed.
21:53 And uh we want to compare it to
21:56 um
21:57 to how
21:58 distance it is from the irrigation that is in place in Australia.
22:03 So in that case,
22:03 we're gonna compare the contents of the TBT of the EU TBT
22:09 to the content of um
22:11 the TBTs imposed in Australia.
22:15 So,
22:15 here we put below um
22:17 an example.
22:18 Um,
22:19 so TB23 is now um is looking at the gluten content in the products.
22:25 And here we're going to compare how similar the words are,
22:28 and we're going to take out the sim the words that don't have um
22:33 A lot of information,
22:34 for instance,
22:34 drafts of these
22:38 um contains a lot of information per year,
22:39 and we're going to focus more on
22:41 um gluten-free,
22:42 very low gluten,
22:43 gluten content,
22:45 and we're going to compare
22:46 and we're going to take
22:47 an average of how dissimilar it is
22:51 between
22:52 the new regulations compared to what exists in the country as
22:55 a way of measuring how distant the two countries are.
23:00 Camil,
23:00 11 quick question here because this is relevant for,
23:03 for developing countries.
23:04 What do you do in terms of the distance where there is no regulation?
23:08 So,
23:09 um,
23:10 an African country is an exporter
23:13 and they don't have a gluten
23:15 regulation.
23:16 How,
23:16 how does this distance looks like?
23:19 Um,
23:22 So,
23:22 the,
23:23 we're gonna have an average per product per year,
23:26 I think,
23:27 per merger.
23:28 Um,
23:29 and I think if there's no regulations,
23:31 the distance is gonna be the maximum.
23:37 So 0
23:39 If they don't have any.
23:42 Uh,
23:42 it's gonna be one cause it's.
23:46 Yes,
23:46 1,
23:47 so 0 is gonna be 0 dissimilarity,
23:50 and then 1 is gonna be the maximum,
23:52 so maximum dissimilarity,
23:54 and that
23:55 implies then the adjustment costs are,
23:57 are larger.
23:59 Correct.
24:00 Right.
24:11 I just like to ask two quick questions also on this.
24:14 Um,
24:15 like,
24:16 um,
24:17 I guess like a lot of like TBTs also arise from
24:20 if the
24:21 kind of like technical thresholds will be different.
24:24 So I guess like if you compare the text,
24:26 it doesn't look like a big difference,
24:28 but in terms of production,
24:30 kind of like what it means for production can have like a huge difference.
24:33 Do you like somehow like is there like any technical like um
24:37 quantitative thresholds
24:39 mentioned
24:40 in the notifications,
24:41 did you try to use these differently or like make sense of it?
24:45 And the second one is,
24:47 I guess like the compliance
24:49 procedures matter a lot,
24:51 right,
24:51 in terms of conformity assessment,
24:53 um,
24:53 also like in terms of,
24:55 you know,
24:55 do you have to like use a notified body in the in the EU or like,
24:59 you know,
24:59 is it like recertification needed,
25:01 retesting,
25:02 is there like any way that you could
25:04 kind of like look at that in terms of the,
25:07 the impact in,
25:09 Um,
25:09 adaptation costs as well.
25:12 For compliance costs,
25:13 I would say.
25:16 Um,
25:16 so on the first question,
25:18 um,
25:20 We try to find um
25:23 Um,
25:23 regulation with the quantitative thresholds because at the beginning we
25:26 thought it was going to be easier to compare.
25:28 Um.
25:30 But the ones we found were more on pesticides,
25:32 which is more SBS and TBTs.
25:34 Um,
25:35 so if you have any idea of
25:38 One that could have a quantitivity threshold,
25:40 that would be great.
25:41 Um,
25:42 we tried to look for one we couldn't find.
25:44 Um,
25:45 we're still looking whether maybe in the textile industry,
25:48 there could be one if
25:49 maybe the content of textiles,
25:53 fibers could be specified.
25:54 Um,
25:55 so we're still looking at this.
25:57 Um,
25:58 and the second question,
25:59 um,
26:00 so in the beginning,
26:01 we were looking also at whether conformity assessment also have a different,
26:05 um,
26:06 effect
26:07 because the EU also signed a lot
26:08 of mutual recognition agreement with different countries.
26:11 Um,
26:12 So it was a bit two separate things,
26:15 um.
26:17 We're not sure whether that's actually part of um
26:21 Of adaptation costs or as you've mentioned,
26:23 is more compliance costs.
26:25 Um,
26:26 so maybe it would be an additional cost,
26:29 um,
26:29 to the TBTs,
26:31 um,
26:32 but maybe for a developing country which don't have testing facility,
26:35 facility in the countries,
26:36 that would be even harder.
26:39 To show,
26:40 not even to comply with the measures,
26:42 but to show that they are complying with the measures,
26:44 so that would be.
26:46 That,
26:46 that's a good point.
26:54 Thank you.
26:56 And sorry,
26:57 Camille,
26:57 sorry,
26:57 just,
26:57 just to,
26:58 to follow up on that,
26:59 so.
27:00 Um,
27:01 so,
27:01 one thing is what the regulation might be in the exporting country.
27:05 The other is what,
27:07 what exporters might be doing in that country,
27:09 right?
27:09 I mean,
27:09 there could be a,
27:10 you know,
27:11 there could be a long,
27:12 uh,
27:12 you know,
27:12 a,
27:13 a,
27:13 a wide difference between
27:16 In fact,
27:16 as Chavi was saying,
27:17 there could be no,
27:18 maybe there's no regulation,
27:20 uh,
27:21 say on coffee in Ethiopia.
27:22 I have no idea,
27:24 but,
27:24 but,
27:24 you know,
27:25 but there are,
27:26 you know,
27:26 Ethiopian exporters for,
27:28 for coffee that,
27:29 that comply with the DBTs.
27:32 So,
27:33 so,
27:33 so,
27:33 you know,
27:33 so this cost of adaptation is
27:36 I mean,
27:36 you know,
27:37 yeah,
27:38 why,
27:38 why is it on,
27:39 I mean,
27:39 it seems to me that this is like a,
27:41 an upper bound to,
27:42 uh,
27:42 to,
27:42 to the,
27:43 to the actual this because,
27:45 you know,
27:45 ultimately what you want is,
27:47 is for the exporters to comply,
27:48 right?
27:48 And so,
27:49 and so it's,
27:50 it's,
27:51 and again,
27:52 this could be,
27:52 this could be quite different
27:54 from,
27:55 from the actual regulation in the country,
27:57 right?
27:57 Uh,
27:58 cause,
27:59 yeah,
27:59 so,
28:00 yeah,
28:00 so,
28:00 so,
28:01 yeah,
28:01 I'm a bit,
28:02 yeah,
28:03 I'm,
28:03 I'm a bit confused.
28:04 Um.
28:07 So,
28:07 ideally,
28:08 we would have loved to have um firm to firm
28:11 data.
28:12 Um,
28:13 we couldn't find,
28:13 we only have firm to country.
28:15 Um
28:17 The only thing that was a bit reassuring is most of the time there seems to
28:23 To imports from
28:25 a few suppliers by country,
28:27 um.
28:29 Then the only thing is,
28:31 um,
28:31 if there is no regulation in the country.
28:35 Maybe
28:36 for Ethiopian
28:37 exporters,
28:37 the US is the big market,
28:39 so we're gonna decide to apply the US
28:41 um
28:43 regulations.
28:44 The only thing is,
28:45 I don't know how we would be able to know
28:48 whether that's the case or not.
28:50 Um,
28:51 maybe one thing we could look at is a few case studies,
28:54 whether that's the case in some countries.
28:57 And
28:58 So that's,
28:59 that's a good point,
29:00 um.
29:05 Yeah,
29:05 so here we're looking at whether
29:07 um
29:08 which regulations you have to follow to serve
29:10 the domestic market in your country,
29:13 uh,
29:13 but maybe you have firms that only exports
29:16 and
29:17 then have another
29:19 regulations.
29:20 Um,
29:22 But that's a good point.
29:23 I'm not sure how we could
29:24 check for this.
29:40 OK,
29:40 great.
29:41 Um,
29:43 So we're also gonna include um firm product origin
29:46 country fixed effects and sector origin country time fixed effects.
29:51 So here,
29:51 what we want to do is to exploit the time variation
29:55 uh in TBTs within firm product,
29:58 source countries,
29:59 um,
30:00 different import margin.
30:02 While controlling for sector country trends.
30:08 Um,
30:09 so,
30:09 if we look at the first,
30:10 um,
30:11 set of baseline,
30:12 um,
30:12 estimates,
30:13 so here we're gonna focus more on the
30:15 intensive margin.
30:16 So,
30:17 in the first,
30:18 um,
30:18 three columns,
30:19 you have the effects on the import value.
30:21 Um,
30:22 and here we can see,
30:23 um,
30:24 once the EU imposed a new TBT,
30:28 Um,
30:28 the import values of,
30:30 um,
30:30 towards EU country increased by around 1.8%.
30:35 Um,
30:36 if we distinguish a bit more between um how standards or how TBTs are,
30:41 um,
30:43 Deal with in specific countries or specific
30:46 um
30:47 products,
30:47 we can see.
30:49 But there is um quite a big increase
30:52 in the
30:54 um
30:56 In the import value of countries from which
30:59 either the EU has harmonized standards with or um
31:03 in the harmonized sectors within the EU.
31:06 So that increased by around 4.4%.
31:10 Um,
31:11 and here,
31:12 um,
31:12 which is quite surprising,
31:14 we see that if the EU only has mutual mutual recognition of standards
31:18 of the country,
31:19 the effect is negative.
31:21 Um,
31:22 and here it's mostly within the EU and here we found,
31:25 um,
31:25 there is a report by the EU Commission
31:28 that mentioned that uh mutual recognition that might not
31:31 work that well
31:33 between EU members and that sometimes they just decide.
31:37 They either got um denied at customs or the project got the product got rejected,
31:42 so they don't use it anymore.
31:45 And in the last columns,
31:47 um,
31:48 sorry,
31:48 in the third column,
31:49 we're using our,
31:50 um,
31:50 dissimilarity index.
31:52 And here we can see that if the standard deviation,
31:56 if the regulatory dissimilarity index increased by 1 standard deviation,
32:01 um,
32:02 the import value is gonna decrease by around 2.7%.
32:07 If we look at the 2nd part of the table here,
32:10 we're looking at the effect on import price.
32:14 And here we can see the import price increased,
32:17 um.
32:18 Um,
32:19 regardless of the
32:21 origins,
32:23 um.
32:25 Um,
32:25 due to the increasing costs or to the adaptation
32:28 costs of the production to the new standards.
32:34 If now we look more at um
32:37 A proxy of um supply chain relocation.
32:40 So here,
32:41 if we could focus on the 1st 3 columns,
32:44 that's the effect on quantity.
32:45 And here again,
32:46 we can see following the imposition of a TBT
32:49 we have an increase in quantity imported from origins,
32:52 um.
32:54 That have that have a low dissimilarity
32:57 or
32:57 that are harmonized with the EU.
33:00 Um
33:02 Um,
33:03 which is,
33:03 um,
33:03 then what is quite interesting is we can see the probability to exit,
33:08 um,
33:09 a sourcing links,
33:10 um,
33:11 Increase um from,
33:14 for the non.
33:16 Um,
33:16 so from the origin.
33:18 From the non-EU origin or for the origin that
33:21 are non-harmonized or doesn't have mutual recognition by around
33:25 um
33:27 And
33:29 1.3% points.
33:33 Um,
33:34 and then if we look at the last,
33:36 um,
33:36 part of the table,
33:38 here we're looking at the probability to enter a new
33:41 or to create a new sourcing link with a new,
33:44 um,
33:44 origin.
33:45 And here we can see the probability
33:48 to enter a new
33:50 Um,
33:50 or to start importing from a new origin
33:53 that is located outside of the EU decreases
33:56 by 2.6% points,
33:58 while it increased
34:00 by around 2 point,
34:02 a bit more than 2% points from harmonized origin.
34:08 And again,
34:08 if we use our um
34:11 Regulatory distance or dissimilarity index
34:15 between countries,
34:16 one standard deviation increase in this
34:18 uh index
34:19 decrease the probability to start
34:21 um importing from a new.
34:24 Um,
34:25 country by around 2.4% points.
34:33 OK.
34:33 Um,
34:34 so we've run several robustness checks,
34:37 um,
34:38 So,
34:39 as someone mentioned
34:40 earlier,
34:41 there might be some um endogeneity concerns about
34:44 uh which products are targeted by the EU.
34:47 Um,
34:48 so here,
34:48 since we're looking at France
34:50 and the
34:52 trade policies,
34:53 uh EU matter,
34:54 normally all the EU members um should agree on the product before setting the TPTs.
35:00 Um,
35:01 however,
35:02 France might still play a role in
35:05 um
35:06 selecting the products.
35:07 So we instrumented the TBTs
35:09 um using
35:10 the,
35:11 sorry,
35:11 we instrumented the EU TBTs using the TBTs um imposed by the US,
35:16 um.
35:18 To control for any
35:20 um
35:21 role played by the tariff,
35:22 we also control for this,
35:23 and um as an additional measure.
35:27 On top of just having a dummy equal to 1,
35:30 if there is a TPT or equal to 0,
35:31 otherwise,
35:32 we also control for uh or use the number of TPTs per product that is imposed.
35:38 Um
35:41 And then we wanted to go a bit deeper in trying to understand
35:45 um where this is coming from and what could explain
35:48 um the results we observed.
35:50 So,
35:50 the first one we think we had in mind is whether um
35:55 if
35:55 the search costs could also,
35:57 could have or could amplify the effect,
35:59 the tri diversion effect that we observed.
36:02 So we use the product stickiness measure that has been developed by Me and Caraus.
36:08 And here we find that links associated to products.
36:12 With higher relationship investment,
36:14 um,
36:17 Investments are less likely to be dropped.
36:20 Um,
36:20 secondly,
36:21 we also look at
36:22 whether the import reliance,
36:24 if you rely,
36:25 um,
36:25 a lot on a specific supplier,
36:27 whether that could also have an effect.
36:29 Um,
36:31 And
36:31 um here we use the France's initial reliance on a specific supplier
36:37 as a way of practicing for bargaining power,
36:40 and we found that
36:42 price pass through depends on these bargaining powers
36:44 and buyers heavily reliant on the source.
36:49 Face larger price rises and steeper quantity reductions.
36:54 And the last um
36:56 The angle we're looking at is whether
37:00 the scale of the finer good producers
37:02 also have an effect.
37:04 And here we found that larger firms,
37:07 um,
37:07 observe that larger firms are the ones that divert more.
37:10 And
37:12 we think it's because larger firms have a larger incentive to resume.
37:17 Um,
37:18 search to find a better match after the TBT is introduced.
37:24 Um,
37:25 so to sum up this first,
37:27 um,
37:27 paper,
37:27 what we found is,
37:28 uh,
37:29 GBTs do cause a trade diversion towards suppliers that face
37:33 lower adaptation costs.
37:36 Um,
37:36 we found also an impact.
37:37 They also have an impact on existing GBCs,
37:40 so the probability to enter a new market,
37:42 decreases by 2.6% points.
37:45 The exit increase from non-EU origin.
37:48 Um,
37:49 and also at the same time it strongly encourage
37:52 entry from harmonized or lower adaptation cost origins.
37:57 And we found that the drivers of um
38:01 The drivers of this diversions are explained by adaptation costs,
38:06 um,
38:06 switching switching costs,
38:08 bargaining power,
38:09 and the size of
38:10 the importer.
38:14 I don't know if
38:16 there is any question.
38:16 We have 5 minutes.
38:17 Uh,
38:18 we are in the half of the,
38:20 of the seminar,
38:23 um.
38:25 I wanted to understand better this mutual recognition effect,
38:28 right?
38:28 And how,
38:29 and how it overlaps as well with the distance,
38:32 right?
38:32 Because you would expect that.
38:34 Modal recognition and
38:37 And distancing regulator,
38:39 uh,
38:39 regulation are very correlated,
38:40 right?
38:41 You'll have mutual recognition when
38:43 you have similar standards,
38:45 no,
38:46 um,
38:47 so I wonder if,
38:48 if the results that you're finding were
38:50 almost,
38:51 I think I,
38:51 I read them,
38:53 uh,
38:53 as in even increasing farther trade diversion
38:57 may be related to the fact that it's,
38:59 it's correlated with your,
39:01 your distance measure.
39:05 Um,
39:09 So for
39:10 uh mutual recognition for the,
39:11 at least for the EU,
39:13 the we only found um
39:17 But the US mutual recognition of standards with
39:20 within the EU.
39:22 So we found that the EU has um harmonized standards with
39:26 I think 5 or 6 countries,
39:28 um,
39:29 but you only have mutual recognition
39:31 within the EU,
39:33 um.
39:35 So that's only within the EU.
39:37 Um,
39:37 and then we have,
39:39 um,
39:40 so in the non
39:41 In these sectors,
39:42 um,
39:43 some of the EU,
39:45 so you have TBT from the EU,
39:47 but then in these sectors,
39:48 you also have,
39:49 um,
39:50 TBTs from
39:51 the member countries itself.
39:53 So,
39:53 for instance,
39:53 in some products,
39:54 Germany is gonna have a TBT.
39:57 So that's where the distance is gonna be,
39:59 um,
40:00 in between.
40:01 Um,
40:02 but I could look a bit more,
40:03 um,
40:04 at the
40:07 If there's a link with the distance or
40:09 if there's a high correlation between mutual recognition and
40:13 Um,
40:13 and the distance measure.
40:18 Any,
40:19 any other questions,
40:20 Phillip?
40:20 You had your hand up.
40:22 Yeah,
40:22 I'm also like still on the regulatory distance point.
40:25 Um,
40:25 I was like wondering,
40:27 so like you base it on the
40:29 TBT notification document,
40:33 I assume,
40:33 but like not on the underlying
40:35 like legal text,
40:37 right,
40:37 which would provide more details and usually the TBT notification is just like a
40:42 summary which might
40:44 These are kind of a critical kind of like elements,
40:46 of course,
40:46 but I was wondering whether you you experimented with that.
40:49 And the second question is,
40:51 I mean,
40:51 you also have like the TB like the trade concerns that are that are raised
40:56 related to TBTs,
40:58 which might also give you like an indication of
41:00 if a lot of countries complain saying,
41:02 hey,
41:02 this is really bad,
41:03 this is really different from,
41:05 you know,
41:06 how it's like generally practiced in other parts of the world,
41:08 like,
41:10 You might have like an indication of the regulatory
41:13 distance as well and the seminarity,
41:16 so it's like anything that you like I tried out and kind of like
41:20 matched somehow the number of trade concerns raised by countries with
41:25 the regulatory disseminarity.
41:30 Um
41:32 So that's
41:33 really good points.
41:34 On the first one,
41:35 we haven't,
41:35 we use the TBT itself,
41:37 so we haven't checked within the documents.
41:41 Um,
41:44 I think we could do it for the countries,
41:46 but,
41:46 or,
41:47 or maybe not,
41:48 maybe we don't need um
41:51 Cause I guess we would need to um translate the document in one
41:55 language to be able to compare.
41:57 But that's something we could do,
41:58 but I guess maybe we're gonna lose some information into the translation,
42:02 but that's something we haven't looked at.
42:03 So maybe that's um
42:05 one option we could look at whether
42:07 to have a bit more
42:09 um
42:10 information.
42:11 And on the second point,
42:14 um,
42:16 We haven't checked whether we could match with the trade concerns,
42:19 um.
42:23 Well that's a good point because that would also be a bilateral measure,
42:26 so maybe some specific countries are going to complain about specific measures,
42:31 um.
42:32 So that could also be a way of saying this is really different from us,
42:36 um.
42:38 And we could know this specific group of countries
42:41 complain more about it rather than other countries that did not complain.
42:44 So we could look,
42:45 we haven't done it,
42:46 um,
42:46 but that's a good point.
42:47 Thank you.
42:54 If there are no more questions,
42:56 I suggest that we move to
42:58 To the second paper,
42:59 so we have time enough for discussion.
43:04 OK.
43:04 Thank you so much.
43:06 Um,
43:06 so now I'm gonna move to the second paper which looks more at,
43:10 um,
43:10 into what's the impact of voluntary standards.
43:14 Um,
43:15 so the idea of this paper and the motivation was,
43:17 um,
43:18 environmental awareness,
43:19 um,
43:19 has been increasing over,
43:21 over the past years.
43:23 Environmental impact of product is becoming more now
43:26 an important purchase criterion for many customers,
43:29 and as a results,
43:30 we observed that firms
43:32 are increasingly implementing voluntary environmental standards.
43:36 And,
43:37 these standards,
43:38 um,
43:39 help organizations identify,
43:41 manage,
43:41 monitor,
43:42 and control their,
43:43 um,
43:44 environmental issues.
43:45 And just to give you an example,
43:47 um,
43:47 and
43:48 Um,
43:49 how you can know,
43:50 uh,
43:51 where a firm is certified and how
43:53 you could be influenced,
43:54 um,
43:55 in your day to day life.
43:56 Um,
43:57 so that's an example of a truck that was,
43:59 uh,
44:00 parked outside of the university in Geneva
44:02 with,
44:03 um,
44:04 which was clearly marked,
44:05 but they are,
44:06 um,
44:06 certified to these three,
44:08 different ISO certification.
44:13 Um,
44:14 So to give you a bit of an idea of how um this stand um works.
44:19 So this stent is aimed
44:20 at helping the organization to reduce its environmental
44:23 impact and increase its um operating efficiency.
44:27 So we're gonna have um several steps.
44:29 The first one is we're gonna review the organization's environmental goals.
44:33 Um,
44:34 they're gonna analyze its environmental impacts and legal requirements,
44:38 and um then we're gonna be able to set environmental
44:41 objectives and targets um to reduce um its environmental impact.
44:46 They're gonna establish programs to meet uh the different objectives.
44:50 And finally,
44:51 we're going to ensure that the
44:52 employees' environmental awareness and competence is um
44:55 good enough.
44:58 So the idea of this paper is um
45:01 to understand what are the firm's motivations behind the certification.
45:04 So why would a firm decide to get certified even
45:07 if it comes at a cost and it's a voluntary
45:10 um certification.
45:13 And secondly,
45:14 what are the effects of voluntary certifications on firms' export performance?
45:19 So what's the effect um once the firms get certified?
45:23 So,
45:23 the main contributions are this um paper of freefold.
45:27 So the first one is um the first paper
45:29 to study the impact of of environmental cations on
45:34 both the extensive and intensive um firms.
45:38 And margins.
45:41 I'm gonna propose both an instrumental variable
45:44 strategy and a propensity score matching
45:47 um to account for the endogenous nature of the certification.
45:51 And I'm gonna investigate the differential effect across this nation,
45:56 countries,
45:57 products,
45:57 and firms
45:59 characteristics.
46:01 Um,
46:02 so for this,
46:03 um,
46:03 paper,
46:04 again,
46:04 I'm gonna use,
46:05 um,
46:06 French firm level data.
46:07 So I'm gonna have information on,
46:09 um,
46:10 exports at the firm year,
46:12 products,
46:12 and destination level.
46:14 Um,
46:15 I'm also gonna use administrative data.
46:17 So I'm gonna have,
46:18 um,
46:19 information
46:20 level based on tax reports.
46:23 And,
46:23 um,
46:24 I'm gonna have information that is coming from a more environmental data sets
46:29 which,
46:30 um,
46:31 collects information on the investment and studies made by the firms.
46:35 Towards protecting the environment
46:37 and it includes um the implementation of an environmental management system,
46:43 which is at the plant level.
46:45 So I'm gonna know whether the firm is certified or not.
46:50 Um,
46:51 in the data,
46:52 I'm gonna have information whether the firm is certified or not,
46:55 and it's going to be whether the firm is certified to
46:58 um one of its three standards.
47:00 So even the,
47:01 even the international one,
47:03 so the ISO 14001,
47:05 or some sort of the European equivalent
47:08 or
47:09 French equivalent.
47:11 Um
47:13 So nowadays there are more than 3000.
47:17 Certifications
47:20 in 171 countries.
47:23 Um,
47:25 As of 2020,
47:27 the more
47:29 European equivalent counted more than 3000 organizations and
47:36 12,
47:36 more than 12,000
47:38 plants.
47:40 And the French equivalent is um a model for the establishment and certifications
47:46 and to help firms get,
47:48 um,
47:48 reach one of these two other standards.
47:55 Um,
47:56 so just to give you an idea,
47:57 um,
47:58 so I,
47:59 I,
47:59 I'm gonna focus on the study period between 2002 and 2018.
48:03 Um,
48:04 and here,
48:04 as you can see,
48:05 the number of plants have been increasing
48:07 and over the period and,
48:09 um,
48:10 also the number of,
48:11 um,
48:12 certified
48:13 plants.
48:16 Um,
48:17 and here in my case to answer,
48:20 uh,
48:20 my research question,
48:21 I'm gonna,
48:22 um,
48:23 rely again on different,
48:25 I'm gonna look at the effect on different trade margins.
48:28 So I'm gonna look at um
48:30 the export value,
48:31 but also the quantity and the um
48:34 the effect on unit value.
48:36 And I'm also gonna look at the extensive margin and I'm gonna
48:39 look at the um effect on the probability to start exporting.
48:44 And here,
48:45 my um variable of interest
48:47 is going to be certification.
48:49 So,
48:50 the certification status of the firm is gonna be given at the plant level.
48:55 So,
48:55 I'm gonna have to aggregate this information at the firm level.
48:59 So,
48:59 I'm gonna use the share
49:01 of plants that are certified um
49:04 within the firm year combination.
49:07 Um,
49:08 I'm also gonna control whether the firm is certified to
49:12 any other certification of label in case there is any,
49:15 some sort of,
49:15 um,
49:16 learning effects
49:17 of if you're already certified to another label,
49:20 maybe it's gonna be easier to be certified to,
49:22 um,
49:23 to this environmental certification.
49:27 And I'm gonna control for,
49:29 uh,
49:29 firm uh fixed.
49:31 I'm gonna include firm fixed effects to control for
49:33 any factors that are specific to the firms,
49:36 and also gonna control for product destination year fixed effects.
49:39 So to control for any factors such as business cycle,
49:42 export demand shock,
49:44 um,
49:45 and the market
49:46 and,
49:46 uh,
49:47 competition conditions that the firm is facing.
49:50 So,
49:51 here again,
49:51 what I want to do with this um
49:53 identification strategy is to exploit the time variation
49:57 of certification in trade margins within firms that export the same product.
50:02 Um,
50:03 to the same destination,
50:04 um,
50:05 while controlling for any market conditions.
50:09 Um
50:14 Um,
50:14 so if we look at the first,
50:16 um,
50:17 um,
50:18 set of,
50:18 um,
50:19 baseline results,
50:20 um,
50:21 so here,
50:21 um,
50:22 what we found is following the certification,
50:25 um,
50:25 exports of the firms are going to increase by around 10%.
50:29 This increase,
50:30 uh,
50:31 in the exports.
50:33 Um,
50:34 it's gonna,
50:35 it's explained by both an increase in quantity but also an increase in
50:39 the unit value
50:41 of the firm.
50:43 And um
50:44 if we look more now into the extensive margin and
50:47 whether the firm is more likely to export afterwards,
50:50 um,
50:51 we also found a positive effect,
50:53 um.
50:55 So once the firms get certified,
50:56 it's more likely to start exporting to a new market.
51:02 And
51:04 So,
51:04 as I mentioned in the introduction,
51:06 um,
51:07 there's quite um big concern about the endogenous nature of the,
51:12 um,
51:12 firm.
51:14 Um,
51:14 so,
51:14 the first,
51:15 um,
51:16 endogene issue might be related to,
51:18 um,
51:18 omitted variable bias,
51:20 um,
51:21 which I think is quite,
51:22 um,
51:22 reduced by the use of,
51:24 um,
51:25 Of different um set of fixed effects.
51:29 Um,
51:30 And the results are also robust to the inclusion of
51:34 even more stringent
51:36 fixed effects to control for any composition effect within the film.
51:39 Um,
51:41 and.
51:43 So,
51:43 sorry,
51:43 but what if it,
51:45 this is simply,
51:46 you know,
51:46 certification is simply driven by the buyer
51:49 requiring the firm to be certified.
51:52 So,
51:53 you know,
51:53 I wanna buy from you,
51:55 but the only way to do that is for you to be certified.
51:58 And so that,
51:59 that's what explains.
52:01 So,
52:01 so,
52:01 it's,
52:02 it's basically,
52:02 you know,
52:02 reverse causality.
52:03 So,
52:04 you know,
52:05 I'm certified,
52:06 I,
52:06 I,
52:06 I am certified not because I want to export,
52:08 but,
52:09 sorry,
52:10 uh,
52:11 this is not about
52:12 certification,
52:13 improving the chances to,
52:15 to,
52:15 to export,
52:15 but actually,
52:17 you know,
52:17 uh,
52:18 you know,
52:18 uh yeah,
52:19 uh being required by the,
52:21 by the,
52:22 by the,
52:22 by the buyer,
52:23 by the importer.
52:24 The impor,
52:25 you know,
52:25 the only way I can export is if I,
52:28 if I'm,
52:28 if I'm certified.
52:32 Um
52:34 So,
52:34 I think that's a big point because um so last time I found a document from Tesco,
52:39 so a big retail store in the UK where they had
52:42 a big list of requirements that suppliers have to follow.
52:46 And at the end it was written,
52:47 if you are certified to this ISO standards,
52:51 you don't need to show that you are complying with all the other regulations.
52:55 So I think
52:56 Um,
52:57 that could be a way of,
52:59 um,
53:00 decrease some sort of
53:01 a way of decreasing,
53:03 um,
53:03 export costs,
53:05 um.
53:06 I don't know if that can be a requirement since it's a voluntary standards.
53:12 I guess officially cannot be said,
53:14 but maybe it's
53:15 implied,
53:17 and
53:19 So,
53:19 I guess one way of dealing with this that I'm doing is,
53:22 um,
53:23 and also to deal with selection
53:25 issue.
53:26 I'm comparing um
53:28 firms that are certified to firms that will
53:31 get certified
53:32 later during the study period.
53:34 Um,
53:35 so,
53:36 to control for the selection effective or I'm a big exporter,
53:40 I'm also gonna get certified,
53:41 um,
53:43 So I guess that's one way of dealing with it,
53:45 um.
53:47 The other way again,
53:48 that would be
53:49 if I had um
53:51 firm to firm data where I could control
53:54 for if a specific buyer has specific requirements.
53:58 Um,
53:59 I guess then in that case,
54:00 we would need all the suppliers from
54:03 a given,
54:04 all the buyers from a given country to also,
54:06 to want
54:07 them to be
54:09 um certified.
54:11 Um.
54:13 But I'm sure.
54:15 Do you have data on export destinations
54:17 for those firms because you could assume that
54:20 um
54:21 you could explore whether they are starting to export to other
54:25 destinations,
54:26 right?
54:27 Uh
54:28 yes,
54:28 still you could have the the issue of reverse causality because it may be
54:32 a multinational requiring the
54:34 the certification,
54:35 but
54:36 at least you could argue that
54:38 is is increasing the.
54:40 The,
54:40 the,
54:41 you know,
54:41 you're exporting to new destinations,
54:44 no.
54:45 Um,
54:45 so this I'm looking at whether,
54:47 um,
54:48 once you get certified,
54:49 you start exporting to new destination.
54:51 Um,
54:55 Yeah,
54:55 that's a good,
54:56 I could check.
55:07 Um,
55:08 yeah,
55:08 and the last point would be,
55:10 um,
55:10 so if the firm's export performance affects its decision to get certified.
55:16 Um,
55:17 so,
55:17 to deal with this,
55:18 um,
55:19 reverse causality,
55:20 I,
55:21 um,
55:22 I proposed two different methods.
55:24 So,
55:24 the first one is to rely on instrumental variable.
55:27 Um,
55:28 so,
55:28 in that case,
55:29 for each firm and year in the sample,
55:31 I'm going to compute the share of certified
55:33 plants that are located in the same
55:36 subnational region
55:38 in France producing the same products,
55:40 um,
55:41 as a way of controlling for,
55:44 um,
55:47 So,
55:47 any other um
55:50 variables that could uh influence your decisions to get certified
55:54 um other than the
55:59 The,
56:00 the
56:01 competition or the market conditions that you're facing.
56:05 And the second um solution I'm offering is to,
56:08 um,
56:09 to rely on or to employ 1 to 1
56:12 dynamic propensity score matching uh methods.
56:16 So in that case,
56:17 every,
56:17 for every firm
56:19 in the sample every year,
56:20 I'm gonna,
56:21 um,
56:24 I'm going to match this firm to a non-certified firm,
56:27 but which has the same probability to get certified.
56:32 Than the,
56:33 the treated firm.
56:37 Um,
56:37 and here,
56:37 if we look at the results using these two different methods,
56:41 um,
56:42 so the first four columns using is using the IV.
56:45 So here we can see the effects,
56:47 um,
56:47 are similar.
56:48 The design of the,
56:49 of the effects are similar to what we had in the baseline,
56:52 um,
56:52 but the magnitudes of the coefficients are,
56:55 um,
56:56 bigger,
56:57 which would suggest that um
57:00 Um,
57:01 The smaller firm would be the one getting certified.
57:05 Um,
57:05 and if we look at the,
57:07 um,
57:08 last three columns of the table here,
57:10 we can see the,
57:11 the results,
57:12 um,
57:12 using the propensity score matching.
57:14 And here we can see the results are,
57:16 um,
57:17 both the sign and the magnitude of the effect are really similar to what I had,
57:21 um,
57:21 in the baseline.
57:24 Um,
57:24 so I ran a lot,
57:25 quite a lot of,
57:26 um,
57:26 robustness checks.
57:28 Um,
57:30 Um,
57:31 so,
57:32 instead of,
57:32 um,
57:33 so I use,
57:33 uh,
57:34 instead of using the share of certified,
57:35 I use a dummy.
57:36 I also look at the effect on sales and export of sales,
57:40 and I found,
57:40 um,
57:41 also a positive effect on sales.
57:44 Um,
57:44 so I use the results also robust to
57:47 use another additional estimator to add different controls,
57:51 um.
57:53 Different fix effects,
57:54 etc.
57:56 And the last thing I wanted to look at and um is to look at whether
58:00 um what could be the potential drivers of this um certification.
58:04 So what would a firm,
58:06 what would be the firm's motivations behind the certification.
58:10 So the first thing I'm looking at is whether the effect
58:12 is different depending on the product the firm is exporting.
58:17 And here I use um the best classification
58:19 to distinguish between the different types of products.
58:22 And here I found um when we distinguish between intermediate and final goods,
58:27 um,
58:28 that the,
58:30 the quantity,
58:31 um,
58:31 exported increase,
58:33 um,
58:34 only for final goods,
58:35 uh,
58:36 which suggests that environmental supplication seems to
58:38 matter more for finer consumers than for,
58:40 um,
58:42 Um,
58:42 intermediate,
58:43 um,
58:44 buyers.
58:46 Um,
58:46 the second thing I was interested in is whether the effect is
58:49 different depending on where or to which market you're selling to.
58:53 So,
58:53 I look at the effect,
58:55 um,
58:55 first by the level of development.
58:57 Um,
58:58 and here,
58:58 the richer the country,
59:00 the larger the effect.
59:01 Um,
59:02 I also look at whether
59:04 if you have,
59:05 um,
59:05 as a way of measuring for environmental
59:07 awareness or environmental consciousness in the,
59:10 in the country.
59:11 I look at whether the EU has signed um
59:14 a trade agreement,
59:15 which includes environmental provisions
59:18 for those countries.
59:19 Um,
59:20 and here I observed that the increase in export volumes,
59:22 um,
59:24 Is quite similar,
59:25 but the price premium,
59:26 sorry,
59:26 um,
59:27 is observed.
59:29 And
59:30 with these countries.
59:32 And
59:33 And then as a last proxy for this uh environmental awareness,
59:37 I look at um
59:38 how big green imports represents in the total imports basket of the product.
59:44 And here I found that um certified firms are able
59:47 to charge a higher price to this um destination.
59:51 And the last thing I was,
59:53 I looked at and I'm interested in is whether
59:57 the effect is different depending on the firm.
59:59 So I use um
1:00:01 Value added per worker as a proxy for the firm productivity,
1:00:06 and here I found that larger firms are the ones
1:00:08 able to charge a higher price premium to consumers.
1:00:13 Camille,
1:00:13 can,
1:00:13 can we may perhaps before you go to the,
1:00:15 the conclusions,
1:00:16 explore the,
1:00:18 theterogeneity at the levels of development,
1:00:21 um,
1:00:22 which may be very relevant because
1:00:25 In a way
1:00:26 you would expect that if,
1:00:28 if
1:00:30 kind of the,
1:00:30 the,
1:00:31 the channel of the standard is,
1:00:32 is through signaling.
1:00:34 That some of the returns of that should be larger for developing economies,
1:00:38 right?
1:00:39 The cost may be larger,
1:00:40 but at least
1:00:41 the sort of the returns as well,
1:00:43 uh,
1:00:44 to export,
1:00:45 which should be larger,
1:00:47 is that not what you find?
1:00:49 Um,
1:00:50 so when I,
1:00:50 when I,
1:00:51 uh,
1:00:51 distinguish between developing and least developed economies,
1:00:55 um,
1:00:56 I found that the exports decreases.
1:00:59 Um,
1:00:59 the exports to least developed economies,
1:01:01 um,
1:01:02 decreases,
1:01:03 uh,
1:01:03 but increase for developing,
1:01:05 developing economies.
1:01:06 Um,
1:01:09 OK,
1:01:09 so,
1:01:09 so it's the mirror you're looking at the
1:01:10 exports to developing countries and to developed.
1:01:13 Oh,
1:01:13 OK.
1:01:14 All right,
1:01:14 right,
1:01:15 because I think,
1:01:15 um,
1:01:16 so I think if that would be the other run,
1:01:18 so if it would be exporters in developing countries,
1:01:21 I think that could be a really
1:01:23 helpful for them to get certified,
1:01:25 um.
1:01:27 And to export to more developed economies,
1:01:29 I think that could be.
1:01:31 Useful.
1:01:33 So the idea here of the mirror is that it
1:01:35 should be because the developing country markets are less demanding.
1:01:39 Uh,
1:01:40 you know,
1:01:41 the effects should be
1:01:42 lower
1:01:43 than for other
1:01:45 advanced countries.
1:01:46 OK,
1:01:46 so either there is less demand or there are
1:01:49 maybe a
1:01:51 Lower willingness to pay for a higher price for this
1:01:54 more environmentally friendly products in
1:01:57 And
1:01:58 more developing countries.
1:02:05 So maybe I can sum up this paper.
1:02:08 So what I found is environmental certification leads to an increase
1:02:13 in the export value by around 10%,
1:02:15 which is explained by a price premium of
1:02:19 a bit more than 2% and an increase in quantity exported by 9.6%.
1:02:24 So environmental certification seems to act as a quality signal for um
1:02:29 for these products,
1:02:31 for these firms.
1:02:32 Uh,
1:02:32 but it also creates new economic opportunities for certified firms.
1:02:37 So the probability to exports increased by 1.1% following the certification.
1:02:43 And the results are heterogeneous across destinations,
1:02:47 products,
1:02:47 and
1:02:48 firms.
1:02:51 Thank you very much.
1:02:54 Thank you,
1:02:54 Camille.
1:02:55 Uh,
1:02:55 let me open to
1:02:57 the questions.
1:03:00 Please feel free to ask.
1:03:04 Any questions?
1:03:08 Marilla.
1:03:13 Hi Camille,
1:03:13 thank you so much.
1:03:14 It's just,
1:03:15 I mean,
1:03:16 it's amazing work,
1:03:17 very,
1:03:17 very fascinating,
1:03:18 lots of interesting things,
1:03:19 uh,
1:03:20 that we've seen,
1:03:21 and
1:03:22 I just have a couple of uh questions,
1:03:24 like going back to your first presentation.
1:03:27 I was really interested in this regulatory dissimilarity index,
1:03:32 and I was,
1:03:33 it seemed to me if I paid enough attention that it stopped in 2019.
1:03:38 I was wondering if it could be expanded
1:03:41 and why did you stop in 2019.
1:03:43 Does,
1:03:44 does anything change in the.
1:03:46 Alright,
1:03:47 so just curiosity for that,
1:03:49 uh,
1:03:50 now second,
1:03:50 you said,
1:03:51 um,
1:03:51 that you showed us the differences in certification
1:03:56 impacting exports to developed and developing countries.
1:03:59 Uh,
1:03:59 yes,
1:03:59 the coefficient for developing countries was a little bit smaller,
1:04:04 but,
1:04:04 um,
1:04:05 they kind of look pretty much the same to me,
1:04:07 so I'm not sure if we can really speak about heterogeneity.
1:04:10 And another,
1:04:11 but again,
1:04:12 um,
1:04:12 you can clarify if I didn't pay attention to the,
1:04:15 to the,
1:04:15 the numbers,
1:04:16 uh,
1:04:17 um,
1:04:18 enough,
1:04:19 but,
1:04:19 um,
1:04:20 and then the final thing you just said
1:04:22 that the probability of exporting increases by 1%.
1:04:25 I was a bit
1:04:27 kind of disappointing.
1:04:28 I would disappointed.
1:04:29 I would have expected a bigger result assuming
1:04:32 that it's a costly process to certify and,
1:04:35 and so on.
1:04:36 And regardless of what's driven,
1:04:39 what's driving what,
1:04:40 you know,
1:04:40 the,
1:04:40 the
1:04:41 willingness to exports driving the need to certification or,
1:04:44 or the other way around,
1:04:45 it seemed like a very small effect,
1:04:47 uh,
1:04:48 for a supposedly significant effort.
1:04:51 I was wondering what's,
1:04:52 what's your take on this,
1:04:53 this probability of 1.4% increase in exports seemed,
1:04:56 seemed low to me.
1:04:58 Uh,
1:04:58 thanks so much.
1:05:02 Um,
1:05:02 so thank you very much.
1:05:03 On your first,
1:05:04 um,
1:05:05 question,
1:05:06 um,
1:05:07 we just stopped in 2019 cause that's when we started to
1:05:12 Um,
1:05:13 when we started collecting the data,
1:05:15 but we could easily update it and then add the new ones,
1:05:18 um.
1:05:20 It's just when that's when the all the data stops,
1:05:23 so I guess that's why,
1:05:24 um,
1:05:25 but that could easily be extended,
1:05:27 um.
1:05:28 On your second point,
1:05:29 um,
1:05:30 you're totally right.
1:05:31 The
1:05:32 It's more heterogeneous
1:05:34 with the least developed economies.
1:05:36 So the least developed
1:05:38 exports to the least developed economies,
1:05:40 the results were negative.
1:05:42 Um,
1:05:42 but indeed,
1:05:43 it was,
1:05:43 um,
1:05:44 positive for developing and developed.
1:05:46 Um,
1:05:47 so in between developing and developed,
1:05:49 I'm not,
1:05:49 um,
1:05:50 I could check whether the coefficients are different,
1:05:52 but I'm not sure.
1:05:53 So,
1:05:53 I think,
1:05:53 um,
1:05:54 you're right.
1:05:54 So,
1:05:54 it was more,
1:05:55 um,
1:05:57 With respect to least developed economies,
1:06:00 that there was an um heterogeneity.
1:06:04 And um on your last point,
1:06:05 um,
1:06:06 so I agree,
1:06:07 I think,
1:06:08 um,
1:06:10 So I was also expecting a bigger results,
1:06:12 um.
1:06:13 Um,
1:06:14 so one
1:06:15 explanation I might have,
1:06:16 um,
1:06:17 is
1:06:18 the
1:06:20 It might be because French firms are already exports to
1:06:24 Quite a lot of um destination already even before getting certified.
1:06:28 So that might be one explanation.
1:06:30 Um,
1:06:31 because I think the last time I found some paper
1:06:34 um that we're looking,
1:06:35 I think in Colombia
1:06:38 and Argentina and there or Ecuador and Argentina and then they
1:06:41 were mostly uh finding an effect on the extensive margin.
1:06:45 So then maybe going back to what Chavi was mentioning,
1:06:47 maybe for more developing countries,
1:06:50 um,
1:06:51 The effect could be even bigger for firms and um allow firms to export even more
1:06:56 to more destinations and to reach more markets.
1:06:59 So I think
1:07:00 maybe one reason why the magnitude is quite small is because France is already
1:07:05 quite developed economies and
1:07:07 um maybe firms are already exporting to quite a lot of markets.
1:07:14 Thank you.
1:07:15 That makes
1:07:16 a lot of sense.
1:07:16 Sorry,
1:07:17 just to follow up,
1:07:17 Chavi,
1:07:18 and I,
1:07:18 I promise,
1:07:19 um,
1:07:20 I was wondering if the reason,
1:07:21 uh,
1:07:22 you focused,
1:07:22 uh,
1:07:23 on France,
1:07:24 uh,
1:07:24 well,
1:07:25 it has,
1:07:26 uh,
1:07:26 something to do with the data quality as well.
1:07:28 I'm sure you have research interests in France,
1:07:30 but
1:07:31 do you know if similar data exists for developing countries that would allow
1:07:36 someone that would allow you to replicate this work for developing countries,
1:07:40 or?
1:07:41 Oh,
1:07:41 it's really like,
1:07:42 you know,
1:07:42 the,
1:07:43 because I know that French data is,
1:07:44 is super good,
1:07:45 but are,
1:07:46 I don't know about the quality of
1:07:48 this specific information for developing countries,
1:07:50 would that be replicable for in other
1:07:53 contexts?
1:07:54 Um,
1:07:55 so the main reason was data availability.
1:07:58 Um,
1:07:58 it's quite nice to have.
1:08:00 Um,
1:08:01 so I had a meeting with the International Standard Organization,
1:08:04 which are also really interesting in knowing
1:08:07 more what's the effect for more developing economies.
1:08:09 Um,
1:08:11 So far,
1:08:11 I think it's quite hard to find information at the firm level
1:08:15 on whether a firm is certified or not.
1:08:18 Um,
1:08:19 So I was looking,
1:08:21 um,
1:08:21 so I don't know if
1:08:23 the accreditation bodies um in the countries would be willing
1:08:27 to share the information on which firms are certified or not.
1:08:30 Um,
1:08:31 this,
1:08:31 I don't know.
1:08:33 But indeed,
1:08:33 I think that would be really interesting.
1:08:35 Um,
1:08:36 so I think it must exist for Argentina and Ecuador because I saw it
1:08:41 for
1:08:42 Um,
1:08:43 but I think Argentina was another standards,
1:08:45 but I think might,
1:08:46 um,
1:08:47 exist for other countries.
1:08:48 Um,
1:08:49 but I guess the
1:08:53 The aggregate,
1:08:53 um,
1:08:54 yeah,
1:08:54 maybe some firms are willing to share because otherwise it would,
1:08:57 uh,
1:08:58 be,
1:08:58 I think,
1:08:58 a long process to check online whether a firm is certified or not,
1:09:01 um,
1:09:02 if you have to do it one by one.
1:09:05 Thank you.
1:09:09 Thank you.
1:09:10 Any more questions?
1:09:14 No,
1:09:14 Perhaps I have a,
1:09:15 a final question,
1:09:16 at least on my end,
1:09:17 um,
1:09:18 on the terogeneity across sectors.
1:09:20 Uh,
1:09:20 you look a little bit
1:09:22 for the first paper on intermediates,
1:09:24 but,
1:09:24 uh,
1:09:25 I was wondering for the,
1:09:27 for the second paper,
1:09:28 probably environmental standards.
1:09:31 Matter differently for different sectors and exports.
1:09:34 I,
1:09:34 I was wondering if you,
1:09:35 if you explore the differences across sectors of,
1:09:38 of French exporters.
1:09:41 Um,
1:09:42 so I start looking at,
1:09:44 um,
1:09:44 I wanted to know,
1:09:45 for instance,
1:09:45 if the sector is more concentrated,
1:09:48 maybe if the effect is different,
1:09:50 um,
1:09:51 So I started looking into this,
1:09:53 um,
1:09:54 Maybe I could check a bit more,
1:09:56 look into um whether
1:10:00 Depending on sector characteristic if the effect is different,
1:10:03 that's a good point.
1:10:04 I haven't checked it yet.
1:10:11 OK,
1:10:11 colleagues,
1:10:12 uh,
1:10:13 if there are no more questions,
1:10:15 um,
1:10:16 I think we,
1:10:17 we can close here.
1:10:19 Uh,
1:10:19 thank you very much,
1:10:20 uh,
1:10:21 Camille,
1:10:22 for a very inspiring
1:10:24 discussion,
1:10:25 and,
1:10:25 uh,
1:10:25 the next seminar will be in May 15th.
1:10:29 The standard sizes the government role in diffusion
1:10:31 of mass production techniques in the US.
1:10:33 So
1:10:34 please stay tuned.
1:10:36 Thank you.
1:10:36 Thanks everybody.
1:10:37 Thank you very much.
1:10:38 Thank you for having me.
- add-style
- lp-body-content