The Review of Economics and Statistics 2025
Rules of Origins Relaxation and Regional Supply Chains: Evidence from Europe
Abstract
We examine how Rules of Origin (RoO) and cumulation provisions in Free Trade Agreements shape imports and supply chains. Using a new RoO database and two policy changes, the Pan-European Cumulation System and the 2004 EU enlargement, we show that relaxing RoO increases intermediate imports from countries where cumulation restrictions were lifted. A 1% higher value requirement before liberalization raised such imports by 0.4–0.7%. Effects are stronger when preferential margins are higher, underscoring the joint role of RoO, cumulation provisions, and tariffs in shaping sourcing decisions.
- DOI
- 10.1162/rest.a.1619
- Pages
- 1-45
- Language
- en
- Sources
- crossref openalex