Dür, Andreas, Leonardo Baccini, and Manfred Elsig The Design of International

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1 Online appendix Dür, Andreas, Leonardo Baccini, and Manfred Elsig The Design of International Trade Agreements: Introducing a New Database. Review of International Organizations. Additional descriptive evidence Here we provide some additional descriptive evidence drawn from DESTA. First, in Figure A-1 we show the percentage of agreements that include a few key provisions, separately for North-North, North-South and South-South agreements. Interestingly, North-South agreements are the deepest ones; whereas the South-South agreements tend to be the least far-reaching ones. Figure A-1: Inclusion of provisions in PTAs, by North South. North North North South South South Service liberalization mentioned Investment liberalization IPR reference Procurement provision TBT mentioned SPS mentioned Chapter on competition Antidumping (AD) provisions Safeguard provisions Subsidy provision Allowing countervailing measures Some type of dispute settlement age 2 1 age 2 1 age Second, Figure A-2 shows the trend over time with respect to the inclusion of these provisions. This graph leads to the same conclusion as Figure 5 in the main part of the paper: that over time, agreements have become deeper. 1

2 Figure A-2: Inclusion of provisions in PTAs, over time. Services Investments IPRs s 19s 197s 19s 199s 195s 19s 197s 19s 199s 195s 19s 197s 19s 199s Procurement TBT SPS s 19s 197s 19s 199s 195s 19s 197s 19s 199s 195s 19s 197s 19s 199s Competition Antidumping Safeguards s 19s 197s 19s 199s 195s 19s 197s 19s 199s 195s 19s 197s 19s 199s Subsidies Countervailing measures Dispute settlement s 19s 197s 19s 199s 195s 19s 197s 19s 199s 195s 19s 197s 19s 199s Operationalization of depth Our second operationalization of depth starts from the observation that many of the variables in our dataset are highly correlated (see Figure A-3). 2

3 Figure A-3: Correlations between variables. COMP_MERGER COMP_MONOPOLY COMP_COM_AUTHO COMP_COOR_AUTHO COMP_NAT_AUTHO COMP_CHAP SPSharmon1 TBTharmon1 SPSWTO SPScoop TBTintstand TBTdistort TBTCoop TBTWTO procwto proctransparency procnational procprovi1 ipr_geo_indic ipr_pharma ipr_specific_prov ipr_phono ipr_copy_right ipr_trips ipr_bern ipr_paris ipr_rome ipr_mfn ipr_gen_stat1 inv_mov_bus_per inv_transf_pay inv_nt inv_mfn inv_merger inv_post_est_oper inv_est_oper inv_pre_est_oper inv_trim inv_stand_treat1 inv_sect_cov1 servicecontinuous sermovement sernonestablishment servicesnationaltreat1 serapproach1 servicesmfn sergatsref servicechap1 servicechap1 sergatsref servicesmfn serapproach1 servicesnationaltreat1 sernonestablishment sermovement servicecontinuous inv_sect_cov1 inv_stand_treat1 inv_trim inv_pre_est_oper inv_est_oper inv_post_est_oper inv_merger inv_mfn inv_nt inv_transf_pay inv_mov_bus_per ipr_gen_stat1 ipr_mfn ipr_rome ipr_paris ipr_bern ipr_trips ipr_copy_right ipr_phono ipr_specific_prov ipr_pharma ipr_geo_indic procprovi1 procnational proctransparency procwto TBTWTO TBTCoop TBTdistort TBTintstand SPScoop SPSWTO TBTharmon1 SPSharmon1 COMP_CHAP COMP_NAT_AUTHO COMP_COOR_AUTHO COMP_COM_AUTHO COMP_MONOPOLY COMP_MERGER Note: darker shading indicates a higher degree of correlation. calculated using tetrachoric correlation. The values were In such a situation, a simple additive index may overestimate the depth of farreaching agreements. Standard factor analysis is based on Pearson correlation and thus not applicable to the binary data included in our dataset. We therefore opted for latent trait analysis, a method developed for binary data. The specific approach that we use is known as the Rasch model, which is frequently applied in psychometrics, 3

4 for example to measure intelligence. A major assumption of the Rasch model is that the items are related to a single underlying dimension; we therefore only included variables in the analysis that are theoretically related to depth. Factor analysis relying on tetrachoric correlation produces similar results; at the level of agreements the two measures are correlated at r=.63 (t=19.62, N=587). 4

5 Figure A-4: Degree to which the variables are associated with the latent trait. TRIM reference Common competition authority National competition authority TBT harmonization Pharmaceuticals in IPRs Mergers WIPO Phonograms Treaty WIPO Copyright Treaty SPS harmonization Geographic indications IPR substantive standards Procurement transparency Procurement national treatment Competition coordination Movement of natural persons (investments) Rome Convention Procurement chapter Investments MFN Services MFN Non distorting standards Negative list approach Standards of treatment Movement of natural persons Acquisitions Pre establishment operation Post establishment operation Bern Convention Investments national treatment Establishment Paris Convention Transfers and payments Services non establishment Investment chapter Competition chapter International standards IPR MFN Procurement WTO Services national treatment TRIPS SPS cooperation GATS reference SPS WTO TBT WTO Service continuous TBT cooperation IPR general Monopoly Service chapter Note: the list of variables included in the analysis (below) offers more information on the items. 5

6 Additional empirical results Table A-1: Descriptive statistics. Variables Mean Std. Dev. Min Max Source lnt rade DOTS 21 and Gleditsch 22 Depth (index) DESTA Depth (latent) DESTA Deep anticipatory DESTA Deep short term DESTA Deep middle term DESTA Deep long term DESTA Shallow anticipatory DESTA Shallow short term DESTA Shallow middle term DESTA Shallow long term DESTA P T A DESTA GAT T/W T O World Trade Organization 212 Regime i Polity IV 21 Conflict ij Uppsala armed conflict dataset Conflict i Uppsala armed conflict dataset lngdp i World Bank 211 Distance CEPII Contiguity CEPII CommonLanguage CEPII CommonColony CEPII CommonLegalSystem CEPII CommonCurrency CEPII Note: univariate statistics of Depth (index) and Depth (latent) are only for dyads that form a PTA. 6

7 Table A-2: Additional evidence I. (A1) (A2) (A3) (A4) VARIABLES ln(trade) ln(trade) ln(trade) res ln(trade) P T A ***.52*** (.23) (.22) (.17) P T A res.68*** (.13) Depth (index).156*** (.6) Depth (index) res.1** (.4) Shallow anticipatory -.141*** -.223*** (.14) (.13) Shallow short term (.23) (.19) Shallow medium term.15***.129*** (.23) (.2) Shallow long term.2***.184*** (.32) (.39) Deep anticipatory.295*** -.12 (.16) (.12) Deep short term.478***.132*** (.21) (.21) Deep medium term.394***.2*** (.19) (.16) Deep long term.224***.723*** (.35) (.32) Shallow anticipatory (15years) -.98*** (.15) Shallow anticipatory (1years) -.19*** (.16) Deep anticipatory (15years).231*** (.14) Deep anticipatory (1years).181*** (.14) Regime i (.1) (.1) (.1) Regime j.1.1*.1 (.1) (.1) (.1) Conflict ij -.589*** -.591*** -.571*** (.127) (.128) (.129) Conflict i -.125*** -.12*** -.134*** (.1) (.1) (.1) Conflict j -.76*** -.71*** -.84*** (.1) (.1) (.1) lngdp i.545***.546***.545*** (.12) (.12) (.12) lngdp j.421***.42***.42*** (.11) (.11) (.11) GAT T/W T O.37***.42***.41*** (.11) (.11) (.11) Constant *** *** *** (.357) (.3) (.1) (.3) Dyad FE yes yes no yes Year FE yes yes no yes Observations 821, , , ,676 R-squared Number of id 22,69 22,641 28,764 22,69 7 Robust standard errors clustered by dyad in parentheses. *** p<.1, ** p<.5, * p<.1 Note: Model A3 relies on 5-yearly data.

8 Table A-3: Additional evidence II. (A5) (A6) (A7) (A8) VARIABLES ln(trade) ln(trade) ln(trade) ln(trade) P T A.93*** -.85*** -.57*** -.88*** (.12) (.14) (.14) (.21) L4.P T A.89***.97***.95***.113*** (.9) (.9) (.9) (.1) L9.P T A.153***.125***.131***.148*** (.13) (.13) (.13) (.13) Depth (index).137*** (.6) Depth (latent).247*** (.13) Shallow anticipatory -.88*** (.12) Shallow short term.11*** (.2) Shallow medium term.48** (.19) Shallow long term.119*** (.29) Deep anticipatory.252*** (.14) Deep short term.387*** (.18) Deep medium term.195*** (.17) Deep long term.35 (.32) Regime i (.1) (.1) (.1) (.1) Regime j (.1) (.1) (.1) (.1) Conflict ij -.463*** -.441*** -.392*** -.458*** (.139) (.1) (.137) (.139) Conflict i -.18*** -.119*** -.119*** -.19*** (.11) (.11) (.11) (.11) Conflict j -.59*** -.7*** -.67*** -.61*** (.1) (.1) (.1) (.1) lngdp i.526***.521***.517***.524*** (.12) (.12) (.12) (.12) lngdp j.431***.427***.425***.429*** (.11) (.11) (.11) (.11) GAT T/W T O.3***.3***.32***.26** (.11) (.11) (.11) (.11) Constant *** *** -2.12*** *** (.365) (.365) (.367) (.363) Dyad FE yes yes yes yes Year FE yes yes yes yes Observations 754, , , ,499 R-squared Number of id 22,619 22,619 22,57 22,619 Robust standard errors clustered by dyad in parentheses *** p<.1, ** p<.5, * p<.1 8

9 Variables included in the latent trait and factor analyses Services [Service chapter] Does the agreement contain a reference to the liberalization of trade in services? [GATS reference] Does the agreement contain a reference to the General Agreement on Trade in Services (GATS)? [MFN treatment] Does the agreement contain an MFN clause for services? [Negative list approach] Does the agreement foresee a negative list approach to services liberalization? [Services national treatment] Does the agreement contain a national treatment clause for services? [Services non-establishment] Does the agreement grant the right of non-establishment for service provision (that is, does it allow the provision of services without local presence)? [Movement of natural persons] Does the agreement allow the movement of natural persons in the provision of services? [Service continuous] Does the agreement contain a review provision for the services provisions? Investments [Investment chapter] Does the agreement contain substantive investment provisions? [Standards of treatment] Does the agreement contain provisions that grant compensation to investors in case of strife and/or expropriation? [TRIM reference] Does the agreement contain a reference to the WTO agreement on trade-related investment measures? [Pre-establishment operation] Does the agreement contain non-discrimination provisions in relation to pre-establishment operations? [Establishment] Does the agreement contain non-discrimination provisions in relation to establishment (e.g., greenfield investments)? 9

10 [Post-establishment operation] Does the agreement contain non-discrimination provisions in relation to post-establishment operation (e.g., the free movement of capital and resale)? [Mergers] Does the agreement contain non-discrimination provisions in relation to mergers and acquisitions? [Investments MFN] Does the agreement grant MFN treatment on investments? [Investments national treatment] Does the agreement grant national treatment on investments? [Transfers and payments] Does the agreement mention specific restrictions regarding transfers and payments? [Movement of natural persons (investments)] Does the agreement mention restrictions related to the temporary movement of business or natural persons? Intellectual Property Rights [IPR general] Does the agreement contain a provision on intellectual property rights (IPRs)? [IPR MFN] Does the agreement contain an MFN provision for IPRs? [Rome Convention] Does the agreement include obligations for acceding to the Rome Convention? [Paris Convention] Does the agreement contain obligations for acceding to the Paris Convention? [Bern Convention] Does the treaty contain obligations for acceding to the Bern Convention? [TRIPS] Does the agreement mention the TRIPS Agreement? [WIPO Copyright Treaty] Does the agreement contain obligations for acceding to the World Intellectual Property Organization (WIPO) Copyright Treaty? [WIPO Phonograms Treaty] Does the agreement contain obligations for acceding to the WIPO Phonograms treaty? [IPR substantive standards] Does the agreement contain specific provisions in relation to substantive standards of protection? [Pharmaceuticals in IPRs] Does the agreement contain references to pharmaceuticals? [Geographic indications] Does the agreement contain references to geographical indications? 1

11 Public procurement [Procurement chapter] Does the agreement contain substantive provisions on public procurement? [Procurement national treatment] Does the agreement guarantee national treatment with respect to public procurement? [Procurement transparency] Does the chapter on public procurement include a transparency provision? [Procurement WTO] Does the agreement contain a reference to the WTO/GATT procurement agreements? Standards [TBT WTO] Does the agreement contain a reference to the WTO Agreement on technical barriers to trade (TBTs) (the GATT standards code)? [TBT cooperation] Does the agreement call for cooperation and/or information exchange on TBTs? [Non-distorting standards] Does the agreement contain a requirement for standards to be least trade-distorting? [International standards] Does the agreement encourage the use of international standards? [SPS cooperation] Does the agreement contain provisions calling for information exchange and technical cooperation on sanitary and phytosanitary (SPS) measures? [SPS WTO] Does the agreement contain a reference to the WTO SPS agreement? [TBT harmonization] Does the agreement contain provisions that stipulate the harmonization of standards? [SPS harmonization] Does the agreement contain provisions that stipulate the harmonization of SPS provisions? Competition [Competition chapter] Does the agreement contain a competition chapter? [National competition authority] Does the agreement contain a provision stipulating the establishment of a national competition authority? [Competition coordination] Does the agreement contain a provision stipulating coordination among national authorities? 11

12 [Common competition authority] Does the agreement contain a provision stipulating the creation of a common authority/institution on competition? [Monopoly] Does the agreement contain a provision on monopolies and cartels? [Acquisitions] Does the agreement contain a provision on mergers and acquisitions? Bibliography Bond, T. and C. Fox 27. Applying the Rasch model: fundamental measurement in the human sciences. Mahwah: Lawrence Erlbaum, 2nd. ed. CEPII. Available from < Polity IV. 21. Country Reports 21. Available from < World Bank 211. World Development Indicators. online. Accessed 3 November 211. World Trade Organization 212. WTO Membership. Available from < e/gattmem e.htm>. Accessed 1 January