This paper provides a systematic estimation of import demand elasticities for a broad group of countries at a very disaggregated level of product detail. We use a semiflexible translog GDP function approach to formally derive import demands and their elasticities, which are estimated with data on prices and endowments. Within a theoretically consistent framework, we use the estimated elasticities to construct Feenstra's (1995) simplification of Anderson and Neary's trade restrictiveness index (TRI). The difference between TRIs and import-weighted tariffs is shown to depend on the tariff variance and the covariance between tariffs and import demand elasticities.

This paper examines the extent to which tariff cooperation is observed among World Trade Organization members. With the help of a simple political economy model, we show that tariffs are positively correlated with the importer’s market power when they are set noncooperatively but negatively correlated when set cooperatively. We use this prediction to empirically identify the extent of cooperation in the WTO and find that more than three-quarters of WTO members’ tariffs are set noncooperatively.