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Are Trade Blocs Building or Stumbling Blocs?

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Author Info

  • E. Baldwin, Richard

    ()
    (Graduate Institute of International Studies)

  • Seghezza, Elena

    ()
    (University of Genoa)

Abstract

The stumbling-bloc argument asserts that regionalism hinders MFN tariff cutting. If this was of first-order importance over previous decades, we should detect this in the levels of the tariffs. Using tariff line data for 23 large trading nations we find that MFN and PTA tariffs are complements, not substitutes since margins of preferences tend to be low or zero for products where nations apply high MFN tariffs. One interpretation is that regionalism is neither a building nor a stumbling bloc. Sectoral vested interests are a ‘third factor’ that generates the positive correlation between MFN and PTA tariff levels.

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Bibliographic Info

Article provided by Center for Economic Integration, Sejong University in its journal Journal of Economic Integration.

Volume (Year): 25 (2010)
Issue (Month): ()
Pages: 276-297

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Handle: RePEc:ris:integr:0505

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Web page: http://econo.sejong.ac.kr/
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Related research

Keywords: Regionalism; Multilateralism; Stumbling Blocs; Trade Blocs;

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Cited by:
  1. Gabriel J. Felbermayr & Mario Larch, 2013. "The Transatlantic Trade and Investment Partnership (TTIP): Potentials, Problems and Perspectives," CESifo Forum, Ifo Institute for Economic Research at the University of Munich, vol. 14(2), pages 49-60, 08.
  2. Bougheas, Spiros & Nelson, Doug, 2013. "On the political economy of high skilled migration and international trade," European Economic Review, Elsevier, vol. 63(C), pages 206-224.
  3. Mavroidis, Petros C., 2011. "Always look at the bright side of non-delivery: WTO and Preferential Trade Agreements, yesterday and today," World Trade Review, Cambridge University Press, vol. 10(03), pages 375-387, July.
  4. Evelyn S. Devadason, 2013. "Whither Sub-Regional Cooperation? The CLMV Perspective," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 5(2), pages 1-36, July.
  5. Gabriel Felbermayr & Mario Larch & Lisandra Flach & Erdal Yalcin & Sebastian Benz & Finn Krüger, 2013. "Dimensionen und Effekte eines transatlantischen Freihandelsabkommens," Ifo Schnelldienst, Ifo Institute for Economic Research at the University of Munich, vol. 66(04), pages 22-31, 02.
  6. Mohd Rosli, 2013. "Book Review: Small and Medium Enterprises (SMEs) Access to Finance in Selected East Asian Economies, by Charlies Harvie, Sothea Oum and Dionisius A. Narjoko, (eds), ERIA Research Project Report 2010-1," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 5(2), pages 159-160, July.
  7. Pramila Crivelli, 2012. "Regionalism and Falling External Protection in High and Low Tariff Members," Research Papers by the Department of Economics, University of Geneva 12071, Département des Sciences Économiques, Université de Genève.
  8. Pedro J. Martinez Edo, 2011. "Reciprocal liberalization: Bilateral, plurilateral or multilateral?," STUDIES IN TRADE AND INVESTMENT, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).

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