author={Pierre Cotterlaz and Vincent Vicard},
title={Why Origin Matters in Trade Data},
type={Working Papers},
Different reporting standards are applied to determine the country of origin of trade flows in existing international trade databases, altering the geography of trade. We illustrate this issue using two extensively used trade databases, UN-Comtrade and IMF-DoTS and show that it has important implications when evaluating the impact of trade policies using a gravity framework. We provide evidence that IMF-DoTs applies different reporting standards for intra- and extra-EU trade from 1999 onwards. Such discrepancies generate a (significant) upward bias in the estimated impact of RTA, the EU and the euro area on trade. Reporting standards also differ across declaring countries in UN-Comtrade. We show that it inflates the estimated impact of Brexit on trade.
keywords={Gravity Equation ; International Trade ; Statistics ; Regional Trade Agreements ; European Union}