The measurement and effects of barriers to trade in basic telecommunication services: the role of negotiations

Abstract

Using econometric methods, this analysis develops quantity impacts of impediments to trade in voice telephone services, focusing on the perspective of negotiated agreements. These impacts, estimated on the basis of market, demographic, and policy variables, establish a baseline from which the achievements of future trade rounds, including the Doha Round, could be compared. In a departure from previous literature in this area, this article draws on documents appended or pertaining to the General Agreement on Trade in Services (GATS) to identify barriers to trade in voice telephone services, and to estimate quantity impacts on this basis. The article finds that market access and national treatment commitments scheduled by WTO members under the GATS, when complemented by commitments to pro-competitive regulatory disciplines, may be formulated into meaningful policy variables. These policy variables are found to be statistically significant in explaining market penetration in voice telephone services, as are variables for income and private sector ownership.