ABSTRACT
What is the relationship between trade policy and growth? Although the issue is fundamental, empirical evidence remains unsatisfactory. The most basic difficulty facing researchers is how to quantify the level of protection in an economy. As is well known, a classic index number problem arises: take the following trade weighted average tariff
ti M
M iti (4.1)
where Mi is the import of good i, ti is the tariff levied on good i, and M is total imports.
