Import Processing and Trade Costs

Carballo, Jeronimo; Graziano, Alejandro; Schaur, Georg; Martincus, Christian Volpe

Abstract

We estimate import processing costs based on the time it takes to import. To do so, we first develop a theoretical model that extends existing time-cost measures to account for uncertainty in import processing. Second, we use detailed, highly disaggregated data on import processing dates and import values to provide estimates of processing costs that are consistent with the theory. This evidence indicates that our extensions to time-cost estimates are economically relevant to determining processing costs. According to our estimates, the tariff equivalent import processing cost is as high as 18 percent. WTO estimates suggest that the full implementation of the 2013 Trade Facilitation Agreement would reduce the time to trade by 1.5 days. In that case, processing costs would decrease to 13 percent.

Citation

Carballo, J., Graziano, A., Schaur, G., & Martincus, C. V. (2025). Import Processing and Trade Costs. Journal of International Economics, Article 104060. https://doi.org/10.1016/j.jinteco.2025.104060

• Journal Article Type: Article
• Acceptance Date: Feb 3, 2025
• Online Publication Date: Feb 8, 2025
• Publication Date: Feb 8, 2025
• Deposit Date: Feb 19, 2025
• Publicly Available Date: Aug 9, 2026
• Journal: Journal of International Economics
• Print ISSN: 0022-1996
• Electronic ISSN: 1873-0353
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Article Number: 104060
• DOI: https://doi.org/10.1016/j.jinteco.2025.104060
• Keywords: Trade Costs; Border Processing; Trade Policy
• Public URL: https://nottingham-repository.worktribe.com/output/45593988
• Publisher URL: https://www.sciencedirect.com/science/article/abs/pii/S0022199625000169?via%3Dihub