Tariff Rates and Gdp

Tariff Rates & GDP Per Capita

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Research Question: How does GDP per capita affect the weighted mean tariff rates for primary

goods and for manufactured goods?

Hypothesis: We expect GDP per capita to be positively correlated with tariff rates on

manufactured goods as economies with larger GDP figures are typically associated with

advanced technologies and robust manufacturing sectors. In addition, we expect tariff rates on

primary goods to be positively correlated with GDP per capita, however at to a lesser extent.

Data: The data analysis contained 8 different variables: Employment in agriculture (% of total

employment); Control of Corruption: Estimate; Ln GDP per capita (constant 2005 US$); Imports

of goods and services (% of GDP); Labor force participation rate, total (% of total population

ages 15+) (modeled ILO estimate); Imports of manufactured goods as a % of GDP; Tariff rate,

applied, weighted mean, manufactured products (%) and Tariff rate, applied, weighted mean,

primary products (%). All of the datasets were extracted from the World Bank’s official website

with every variable found in the World Development Indicators (WDI) database aside from

Control of Corruption: Estimate which was found in the World Governance Indicators (WGI)

database. After compiling our raw, unorganized dataset, we eliminated any country that had

extremely sporadic data or did not have valid data for at least seven of the 15 years in our

timeframe. For each variable, we took the average of the years 1995-2010, except for Control of

Corruption: Estimate, which was the average from 1996-2010 due to the time frame in which the

data was collected. Taking the averages of each variable was necessary since complete data for

our 15 year window for any variable was virtually impossible to find, so this allowed us to get

relatively strong figures to work with given the data available. We also used the ln of the average

GDP per capita figure to normalize the...