Tariff Barriers and Economic Growth in Peru (1981-2015)

Abstract

This research aims to provide evidence on the impact of tariff barriers in the economic growth in Peru for the period 1981-2015. The studying method is a mixed one, and the type of investigation is ex post facto. The study asserts that tariffs trigger a negative impact in the economic growth of Peru. We worked with two samples, the first one consisted of 35 annual observations for the average tariff rate as independent variable, and the second one consisted of 35 annual observations for the per capita GDP growth rate as dependent variable. The findings let us to assert that there is a moderate impact of average tariff in the GDP growth in Peru. Thus, increasing the average tariff in 1% reduces the per capita GDP in -0.12% and decreasing the average tariff in 1% increases the per capita GDP in 0.12%. In addition, changes in the average tariffs explain 18% of cases of per capita GDP changes. Finally, as reducing or removing in all trade barriers are part of free-trade policies, the possibility of future investigations including effects of total or partial removal of non-tariff barriers in the economic growth is open.