Setting priorities for services trade reform (Australian Research Council Linkage Grant Project)

Research Project

Background

The Australian Productivity Commission has entered into an Australian Research Council Linkage Grant Project Agreement with the Australian National University to conduct research in areas relevant to setting priorities in services trade reform at the national and international levels.

Services are a significant share of economic activity. Inefficiency in services delivery can therefore impede overall economic performance.

Available information suggests that most barriers to trade in services are regulations that operate behind the border and that do not explicitly discriminate between foreign and local firms. As such, the barriers potentially have much greater leverage on economic performance than do border restrictions on trade.

The research proposed under the project will help provide information on the extent and effects of barriers to services trade and facilitate analysis of the potential for reform and of negotiating options in the international arena.

Objectives of the Study

Provide new empirical estimates of barriers to services trade that measure explicitly whether they add to markups or real resource costs.

Expand, where practicable, existing cross country datasets on regulatory barriers to trade in services by looking at how regulatory structure has varied over time.

Place new information in a broad policy context that may be applied to the analysis of the potential benefits of reform and trade policy negotiations.

The Commission’s commitment

This ARC research grant is held by the ANU. The Commission has committed to annual contributions in cash and kind, including membership of the research advisory committee. The Commission will be contributing to a conference in November 2007 on the topic assessing productivity in Australian health services.