An Impact Evaluation of Duty Free Quota Free Market Access for the Least Developed Countries (1998-2010)

Abstract

Duty-Free and Quota-Free (DFQF) market access has been championed as a potential mechanism to reduce poverty through better trade opportunities for the Least Developed Countries (LDCs) since the turn of the millennium. Meanwhile, the empirical evidence to date has been mixed across different jurisdictions, with comparison made difficult due to different methodological assumptions and estimation strategies for the DFQF schemes of Japan, the European Union, Norway, New Zealand and Canada. Using a difference-in-differences and triple differences strategy, it finds that whether or not the DFQF scheme had a positive impact on export growth from the LDCs depends on the dimension of variation considered. Comparing treated products to control products for the LDCs, only the Canadian and Norwegian programmes were effective in inducing export growth. However, when an additional difference at the country level is considered, only the Japanese and the European programmes had positive and statistically significant impacts.