How do Differing Standards Increase Trade Costs? The Case of Pallets

The paper examines why there are so many different pallet sizes, the associated trade costs and the reasons why countries have not harmonized pallet sizes to eliminate such costs. It then presents options for exporters to mitigate the adverse effects of standards multiplicity while complying with destination markets' standard requirements. The range of options is limited in the case of exporters from less developed countries because of the lack of rental and exchange pallet markets. To mitigate the costs of this multiplicity of standards, the World Bank's strategy should be divided in two directions: to develop awareness of costs related to the multiplicity of standards and to support actively harmonization at the global level (within the International Organization for Standardization) and at the regional level (within regional cooperation agreements).

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Published:2005
Classification:Transport & Logistics
AuthorsEnrique Aldaz-Carroll, Gael Raballand
Other bibliographical information:The World Bank. Vol. 1 of 1; Policy Research working paper series, No. WPS3519.