The Everything But Arms Agreement; An empirical assessment with help of a gravity model

This paper assesses the effect that the Everything But Arms arrangement has had on the exports of the Least Developed Countries to the European Union. This is done by using a gravity model. As a control group, countries benefitting from the regular Generalized System of Preferences are used. Furthermore, products on which a zero MFN tariff rate is applied are included as a control group. The analysis includes data from 2001, when the arrangement came into force, up until 2014. The analysis showed a positive overall effect on the exports of Least Developed Countries. The effects, however, vary between different types of goods. The largest beneficial effect was seen in the market for agricultural products.