Trade creation and trade diversion in the EEC, the LAFTA and the CMEA: 1960-1994
AbstractIn a simplified version of the gravity model, appropriate dummy variables have been introduced to analyse the effects of both trade creation and trade diversion by three economic organizations, the European Economic Community (EEC), the Latin American Free Trade Association (LAFTA) and the Council of Mutual Economic Assistance (CMEA), for the period 1960-94. Five-year intervals are the main subject of measurement. The results show that both trade creation dummies and trade diversion dummies have statistically significant coefficients, which show the appropriateness of this new approach. The trade creation effect and trade diversion effect of each institution are proved to be generally weakening during the 1990s. It is also observed that each Organization has a distinctive international trade character. For Japanese trade, a similar approach is used to analyse nonaligned trade by Japan, with particular interest in the effects of these three institutions on trade with Japan. The result is that there is no strong evidence that the EEC and the LAFTA trade with Japan any more or less than the hypothetical level predicted by basic explanatory variables, while the CMEA increased its trade with Japan up to the hypothetical level during the analysis period.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal Applied Economics.
Volume (Year): 31 (1999)
Issue (Month): 2 ()
Contact details of provider:
Web page: http://www.tandfonline.com/RAEC20
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Carrere, Celine, 2006. "Revisiting the effects of regional trade agreements on trade flows with proper specification of the gravity model," European Economic Review, Elsevier, vol. 50(2), pages 223-247, February.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty).
If references are entirely missing, you can add them using this form.