Analytics of the Trade Restrictiveness of SPS Regulations: Reconciling Standards and Competitiveness

This paper attempts to review the key issues related to the quantification of the trade effects of standards, especially the Agreement on Sanitary and Phytosanitary Standards (SPS) on agro-food exports. After reviewing some of the key empirical studies on the topic, the paper goes further and examines the later trends in the gravity framework. It is argued that dependence on only one model may not reflect all the theoretically or otherwise attributed border effects on the export performance of the commodity. The paper projects constant market share analysis as a complement to the gravity model, which algebraically isolates the competitiveness effect of exports and gives a better understanding of the various components, export performance, trade flows and export markets. The paper therefore concludes that a more comprehensive assessment of the impact is possible, but it requires a desirable blend of gravity and algebraic methods.