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Why Do Countries Seek Regional Trade Agreements?

In: The Regionalization of the World Economy

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  • John Whalley

Abstract

This paper emphasizes the range of factors which enter country calculations to seek regional trading arrangements. These include conventional access benefits, but extend to safe haven concerns, the use of trade arrangements to underpin security arrangements, and tactical interplay between multilateral and regional trade negotiating positions. In a final section, results from an earlier modelling effort by Perroni and Whalley are used to emphasize that non- traditional objectives may be quantitatively more important than traditionally analyzed objectives.

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This chapter was published in:

  • Jeffrey A. Frankel, 1998. "The Regionalization of the World Economy," NBER Books, National Bureau of Economic Research, Inc, number fran98-1, May.
    This item is provided by National Bureau of Economic Research, Inc in its series NBER Chapters with number 7820.

    Handle: RePEc:nbr:nberch:7820

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    1. Markusen, James R & Wigle, Randall M, 1989. "Nash Equilibrium Tariffs for the United States and Canada: The Roles of Country Size, Scale Economies, and Capital Mobility," Journal of Political Economy, University of Chicago Press, vol. 97(2), pages 368-86, April.
    2. Jeffrey A. Frankel & Shang-Jin Wei, 1995. "The new regionalism and Asia: impact and options," Pacific Basin Working Paper Series 95-10, Federal Reserve Bank of San Francisco.
    3. Gatsios, Konstantine & Karp, Larry, 1989. "Delegation Games in Customs Unions," CEPR Discussion Papers 337, C.E.P.R. Discussion Papers.
    4. Hamilton, Bob & Whalley, John, 1983. "Optimal tariff calculations in alternative trade models and some possible implications for current world trading arrangements," Journal of International Economics, Elsevier, vol. 15(3-4), pages 323-348, November.
    5. John Kennan & Raymond Riezman, 1990. "Optimal Tariff Equilibria with Customs Unions," Canadian Journal of Economics, Canadian Economics Association, vol. 23(1), pages 70-83, February.
    6. Carlo Perroni & John Whalley, 2000. "The new regionalism: trade liberalization or insurance?," Canadian Journal of Economics, Canadian Economics Association, vol. 33(1), pages 1-24, February.
    7. John Whalley & Colleen Hamilton, 1996. "Trading System after the Uruguay Round, The," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 62, July.
    8. Paul Krugman, 1989. "Is Bilateralism Bad?," NBER Working Papers 2972, National Bureau of Economic Research, Inc.
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