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Abstract - Quest for Global Competitiveness - Universidad de Puerto ...

Abstract - Quest for Global Competitiveness - Universidad de Puerto ...

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Where: Std i Tol i is the tolerance level of country i <strong>for</strong> standard j that is greater than orequal to the gui<strong>de</strong>line of the CAC <strong>for</strong> the same standard at time t.Four categories of regulations were chosen <strong>for</strong> FFP and three <strong>for</strong> FV based on dataavailability. These respectively inclu<strong>de</strong>: labeling, contaminants, veterinary drug residueand additives and; labeling, pestici<strong>de</strong> residues and additives.Data <strong>for</strong> standards were obtained from the national regulations of the country: title 21 ofthe co<strong>de</strong> of fe<strong>de</strong>ral regulations (CFR) and documents from the compliance policyprogramme <strong>for</strong> the US, EU Directives and the CAC Documents repository (SeeAppendix 3 <strong>for</strong> main regulations used).INT CBI/LOME/CARICOM is a dummy variable that measures the impact of the free tra<strong>de</strong>arrangement (FTA) on tra<strong>de</strong> flows between Guyana and each of its trading partners. Apriori, a FTA can have either a negative or a positive impact on bilateral tra<strong>de</strong>.The term U ijt is the error term and is assumed to be normally distributed with mean zero.The gravity mo<strong>de</strong>l is the i<strong>de</strong>al methodological framework <strong>for</strong> the estimation of the impactof food safety standards on exports of non-traditional products. The gravity mo<strong>de</strong>lallows <strong>for</strong> a direct indication of the direction and impact of the imposition of a standardon tra<strong>de</strong> flows, as opposed to other approaches such as surveys and case studies andpartial equilibrium approaches (Beghin & Bureau 2001; Iacovone 2003). Further, themo<strong>de</strong>l also allows <strong>for</strong> a comparison of how diverging standards promote or inhibit tra<strong>de</strong>between an exporting country and several of its importing country partners (Wilson &Otsuki 2000; Beghin & Bureau 2000). Also, the gravity mo<strong>de</strong>l because it is constructedon time series data provi<strong>de</strong> an indication of trends and dynamics unlike otherapproaches, such as surveys that are usually one time occurrences (Iacovone 2003).11

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