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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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  • Das, Gouranga Gopal
  • Andriamananjara, Soamiely

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

Paper provided by United States International Trade Commission, Office of Economics in its series Working Papers with number 15870.

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Date of creation: 2004
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Handle: RePEc:ags:uitcoe:15870

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Keywords: hub and spokes; free trade areas; technology transfer; absorption; governance; welfare; preference dilution; International Relations/Trade; Research and Development/Tech Change/Emerging Technologies; D58; F16; O4;

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Cited by:
  1. Chong Soo Yuen & Jung Hur, 2007. "Overlapping Free Trade Agreements of Singapore-USA-Japan: A Computational Analysis," SCAPE Policy Research Working Paper Series 0711, National University of Singapore, Department of Economics, SCAPE.
  2. Argüello C., Ricardo & Valenzuela, Ernesto, 2006. "Market access in the Western Hemisphere: implications for the Andean Community," PERFIL DE COYUNTURA ECONÓMICA, UNIVERSIDAD DE ANTIOQUIA - CIE.
  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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