WTO Membership and Market Access: Evidence from the Accessions of Bulgaria and Ecuador

It is often argued that the quid pro quo for accepting WTO commitments on national trade barriers and other policies is improved access to foreign markets. In this study disaggregated information on exports by two developing countries (Bulgaria and Ecuador) and on the trade barriers of the Quad industrialised countries is employed to evaluate two hypotheses concerning the benefits of WTO membership. We cannot reject the hypothesis that post-accession Bulgarian export growth was faster in those product lines that saw larger reductions in MFN tariff rates in the Quad countries. Nor can we reject the hypothesis that Ecuadorian export growth was higher in those product lines where the gap between MFN and GSP rates narrowed faster, suggesting that a reduction in the uncertainty over the terms of their market access to foreign markets has encouraged that country's firms to ship more goods to the leading industrialised economies.