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Hub-and-Spokes Free Trade Agreements in the Presence of Technology Spillovers: An Application to the Western Hemisphere

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  • Gouranga Gopal Das

    ()

  • Soamiely Andriamananjara

Abstract

Using a comparative-static general equilibrium model and in the context of the western hemisphere, this paper compares the economic effects of a "hub-and-spokes (HAS)" type of bilateral trade configuration (with Chile being the hub) with those of a more comprehensive regional FTA (namely, the FTAA). The model is augmented to account for the possibility of technology spillovers and its effective assimilation among participating economies. In particular, absorptive capacity, governance factor, proximity and socio-institutional congruence conjointly determine an economy's capacity to capture the technology that is transmitted from developed spoke US to other regions.

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Bibliographic Info

Article provided by Springer in its journal Review of World Economics.

Volume (Year): 142 (2006)
Issue (Month): 1 (April)
Pages: 33-66

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Handle: RePEc:spr:weltar:v:142:y:2006:i:1:p:33-66

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Keywords: Hub and spokes; Free Trade Areas; technology transfer; absorption; governance; adjacency; welfare; preference dilution;

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Citations

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Cited by:
  1. Soo Yuen Chong & Jung Hur, 2007. "Overlapping Free Trade Agreements of Singapore-USA-Japan : A Computational Analysis," Trade Working Papers 21931, East Asian Bureau of Economic Research.
  2. Ricardo Arguello & Ernesto Valenzuela, 2005. "Market access in the Western Hemisphere: Implications for the Andean Community," BORRADORES DE INVESTIGACIÓN 003188, UNIVERSIDAD DEL ROSARIO.
  3. Parrado, Ramiro & De Cian, Enrica, 2014. "Technology spillovers embodied in international trade: Intertemporal, regional and sectoral effects in a global CGE framework," Energy Economics, Elsevier, vol. 41(C), pages 76-89.

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