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The effects of the GSTP on trade flow: mission accomplished?

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  • Masahiro Endoh
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    Abstract

    This paper investigates whether the Global System of Trade Preferences among developing countries (GSTP) achieves its intent to increase the trade of capital goods between member countries. For this purpose, trade data disaggregated by the degree of commodity differentiation and various GSTP regional dummies are employed in a gravity equation. Estimation results say that the value of trade between GSTP member countries has increased significantly since the formation of the GSTP in 1989, and the trade of differentiated commodities has increased remarkably compared with other commodities. Therefore, it can be asserted that the mission of the GSTP has been accomplished successfully.

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    File URL: http://www.tandfonline.com/doi/abs/10.1080/0003684042000318182
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    Bibliographic Info

    Article provided by Taylor & Francis Journals in its journal Applied Economics.

    Volume (Year): 37 (2005)
    Issue (Month): 5 ()
    Pages: 487-496

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    Handle: RePEc:taf:applec:v:37:y:2005:i:5:p:487-496

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    1. Jeffrey A. Frankel & Shang-Jin Wei, 1993. "Emerging Currency Blocs," NBER Working Papers 4335, National Bureau of Economic Research, Inc.
    2. Linnemann, H. & Verbruggen, H., 1988. "GSTP tariff reduction and its effects on South-South trade in manufactures," Serie Research Memoranda 0044, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    3. Jeffrey A. Frankel, 1997. "Regional Trading Blocs in the World Economic System," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 72.
    4. Frankel, Jeffrey & Stein, Ernesto & Wei, Shang-jin, 1995. "Trading blocs and the Americas: The natural, the unnatural, and the super-natural," Journal of Development Economics, Elsevier, vol. 47(1), pages 61-95, June.
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    Cited by:
    1. Neil Foster & Robert Stehrer, 2011. "Preferential trade agreements and the structure of international trade," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 147(3), pages 385-409, September.
    2. Simone Juhasz Silva & Douglas Nelson, 2012. "Does Aid Cause Trade? Evidence from an Asymmetric Gravity Model," The World Economy, Wiley Blackwell, vol. 35(5), pages 545-577, 05.
    3. URATA Shujiro & OKABE Misa, 2007. "The Impacts of Free Trade Agreements on Trade Flows: An Application of the Gravity Model Approach," Discussion papers 07052, Research Institute of Economy, Trade and Industry (RIETI).

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