Study Criticizes Differing Consumer Price Structures
Washington, Apr. 9 2004 (VOA News) -- A new economic
study done by a private firm in Washington suggests
that ending the disparity in prices that consumers
pay in rich countries could boost global output
by as much as two percent.
The Institute for International Economics finds
that even in countries that are very open to international
trade the prices that consumers pay vary by from
30 to 50 percent. The study concludes that various
protectionist measures boost consumer prices and
make it harder for imported goods to gain market
share. A
co-author of the study, Robert Lawrence of Harvard
University, says that of eight countries studied,
prices tend to be lowest in Canada and the United
States.
"It's
in North America that we've really seen a major
integration of economies. Canada, in particular,
has become a lot more open over the decade of
the 90s. Europe has become more integrated but
still remains fragmented and Japan as of 1999
still had high external barriers," he said.
The
other author of the study, Scott Bradford of
Brigham Young University, says the elimination
of trade barriers likes quotas and special taxes
would boost the exports of poor countries by
up to 100 billion dollars per year. He says
the trade gains would exceed the foreign assistance
provided by the rich countries that are members
of the Organization for Economic Cooperation
and Development.
"That
is about twice all the ODA development assistance)
that the entire OECD (Organization for Economic
Cooperation and Development-29 richer countries)
gives developing countries every year. So in
one sense we're giving with one hand and we're
taking back with the other through these barriers
that the rich countries have in terms of suppressing
export opportunities of developing countries,"
he said.
The
main conclusion of the study, entitled Has Globalization
Gone Far Enough?, is that economic integration
is lagging even in those countries with the
lowest tariff barriers. Scott Bradford summarizes.
"We
do believe that globalization is far from complete.
We see a lot of evidence that it has not gone
far enough in the sense of potential gains to
both rich and poor countries if we were to work
harder on removing (trade) barriers," he
said.
The
authors say that the world economy could gain
$500 billion a year from the removal of non-tariff
barriers in developed countries.
- Barry
Wood
- Voice of America in Washington
--
Reprinted with the permission of Voice of America
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