Relative Trade Preferential Margin and Aid for Trade Allocation
This article investigates the interplay between non-reciprocal trade preferences and Aid for Trade (AfT) by examining the extent to which relative preferential margins (RPM) enjoyed by recipient countries affect AfT flows supplied by donors. The empirical results suggest that the RPM exerts a significant and positive impact on the bilateral AfT inflows that recipient countries enjoy from donors. In addition, when this impact is lower, the higher the recipient countries’ level of economic development. Furthermore, the analysis indicates that the influence of RPM on AfT is dependent on non-AfT (i.e., the aid flows allocated to the non-trade sector) allocated to recipient countries.
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Document Type: Research Article
Affiliations: World Trade Organization, Geneva, Switzerland
Publication date: May 27, 2018