Overall Trade Restrictiveness Indices and Import Demand Elasticities

The Overall Trade Restrictiveness Index (OTRI) summarizes the trade policy stance of a country by calculating the uniform tariff that will keep its overall imports at the current level when the country in fact has different tariffs for different goods. In a nutshell, the OTRI is a more sophisticated way to calculate the weighted average tariff of a given country, with the weights reflect the composition of import volume and import demand elasticities of each imported product. The empirical methodology of the OTRI was first developed in Kee, Nicita and Olarreaga (2008, 2009), based on the theoretical underpinning of Anderson and Neary (1994, 1996, 2003). Irwin (forthcoming) also uses a similar methodology to study the historic protection level of the US, from 1867 to 1961. Recently, Kee, Neagu and Nicita (forthcoming) applied a fixed weight version of OTRI to study protectionism of a wide range of countries during the crisis period.
The OTRI and some other related indices, such as the Trade Restrictiveness Index (TRI) and the Market Access Overall Trade Restrictiveness Index (MAOTRI) are computed annually when new trade flows and tariff data are available. These indices feed into the Global Monitoring Report, an annual World Bank publication joint with the International Monetary Fund. The latest indices and the underlying trade data and elasticity estimates can be download from below. Please cite Kee, Nicita and Olarreaga (2008, 2009) if you are using the elasticity estimates, the OTRI, TRI, MAOTRI or the Ad-Valorem Equivalent of Non-tariff measures of any given country.