Year: 2021
Type: article
Abstract: In 2003, the Kimberley Process Certification Scheme (KPCS) went into force to stop the trade in those diamonds, directly linked to the fueling of armed conflict and activities of rebel movements, also known as conflict diamonds. This article gives empirical evidence on the impact of the KPCS on international trade in rough diamonds. We find that bilateral KPCS participation facilitates access to international markets for rough diamonds and increases trade values. The bilateral trade impact of the KPCS does not depend on the exporters’ economic development or market access. A more detailed analysis of exporters’ heterogeneity in trade values shows that unilaterally KPCS intensifies the trade impediments resulting from armed conflicts and, thereby, reduces the international trade in rough diamonds stemming from countries with ongoing internal conflicts. We further offer evidence that the KPCS-induced trade effects apply not only to exporter- or importer-hubs but equally to smaller trade partners. Our analysis gives insights into how agreements setting a particular standard may affect international trade patterns in conflict minerals.
Source: World Development
Authors: Stefan Borsky, Andrea Maria Leiter
Institutions: University of Graz, Universität Innsbruck
Language: English
Topic: Global trade and economics
Domain: Social Sciences
Open Access status: hybrid
Estimated APC paid: $3,440
Funders: Erasmus Universiteit Rotterdam, Syddansk Universitet, European Association of Environmental and Resource Economists, Università degli Studi di Verona, Karl-Franzens-Universität Graz, Universität Innsbruck, University of Illinois at Urbana-Champaign, International Institute of Social Studies, Erasmus University Rotterdam
OpenAlex ID: W3131722768