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The Political Economy of EU Enlargement: Or, Why Japan is not a Candidate Country?

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Author Info
Adam, Antonis
Moutos, Thomas

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Abstract

In this paper we argue that strong political economy forces explain the rush of the EU to expand eastwards. We use a model of vertical product differentiation in order to claim that technologically- advanced EU firms (residing in high-income member countries) prefer a mutual market-opening with less technologically sophisticated countries than multilateral liberalization, which would necessarily involve the reciprocal opening of markets with other technologically-advanced countries. By the same token, less technologically sophisticated firms residing in low-income member countries would prefer an enlargement that is directed towards high-income countries. The evidence presented in the paper supports our hypothesis.

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Publisher Info
Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number CESifo Working Paper No. 704.

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Date of creation: 2002
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Handle: RePEc:ces:ceswps:_704

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Related research
Keywords: EU enlargement; vertically differentiated products; political economy; customs unions;

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Find related papers by JEL classification:
D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
F15 - International Economics - - Trade - - - Economic Integration

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

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    Other versions:
  5. James MacKinnon, 1990. "Critical Values for Cointegration Tests," University of California at San Diego, Economics Working Paper Series 90-4, Department of Economics, UC San Diego. [Downloadable!]
  6. Richard E. Baldwin & Joseph F. Francois & Richard Portes, 1997. "The costs and benefits of eastern enlargement: the impact on the EU and central Europe," Economic Policy, CEPR, CES, MSH, vol. 12(24), pages 125-176, 04. [Downloadable!] (restricted)
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    Other versions:
  8. Carlo Perroni & John Whalley, 1994. "The New Regionalism: Trade Liberalization or Insurance?," NBER Working Papers 4626, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  9. Fernandez, Raquel & Portes, Jonathan, 1998. "Returns to Regionalism: An Analysis of Nontraditional Gains from Regional Trade Agreements," World Bank Economic Review, Oxford University Press, vol. 12(2), pages 197-220, May.
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    Other versions:
  12. Ethier, Wilfred J, 1998. "The New Regionalism," Economic Journal, Royal Economic Society, vol. 108(449), pages 1149-61, July. [Downloadable!] (restricted)
  13. Pravin Krishna, 1998. "Regionalism And Multilateralism: A Political Economy Approach," The Quarterly Journal of Economics, MIT Press, vol. 113(1), pages 227-250, February. [Downloadable!] (restricted)
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  14. Arvind Panagariya, 2000. "Preferential Trade Liberalization: The Traditional Theory and New Developments," Journal of Economic Literature, American Economic Association, vol. 38(2), pages 287-331, June. [Downloadable!] (restricted)
  15. Greenaway, David & Hine, Robert C & Milner, Chris, 1995. "Vertical and Horizontal Intra-industry Trade: A Cross Industry Analysis for the United Kingdom," Economic Journal, Royal Economic Society, vol. 105(433), pages 1505-18, November. [Downloadable!] (restricted)
  16. Jaskold Gabszewicz, J. & Thisse, J. -F., 1979. "Price competition, quality and income disparities," Journal of Economic Theory, Elsevier, vol. 20(3), pages 340-359, June. [Downloadable!] (restricted)
  17. Michael Freudenberg & Francoise Lemoine, 1999. "Central And Eastern European Countries In The International Division Of Labour In Europe," Working Papers 1999-05, CEPII research center. [Downloadable!]
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    Other versions:
  20. Craig Parsons, 2000. "Domestic Interests, Ideas and Integration: Lessons from the French Case," Journal of Common Market Studies, Blackwell Publishing, vol. 38(1), pages 45-70, 03. [Downloadable!] (restricted)
  21. Corden, W.M., 1984. "The normative theory of international trade," Handbook of International Economics, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 2, pages 63-130 Elsevier. [Downloadable!] (restricted)
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    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Adam, Antonis / Katsimi, Margarita / Moutos, Thomas, 2008. "Inequality and the Import Demand Function," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  2. Antonis Adam & Thomas Moutos, 2005. "Turkish Delight for Some, Cold Turkey for Others?: The Effects of the EU-Turkey Customs Union," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  3. Theodora Kosma & Antonis Adam & James McHugh, 2003. "Trade Liberalization Strategies: What Could South Eastern Europe Learn From CEFTA and BFTA?," IMF Working Papers 03/239, International Monetary Fund. [Downloadable!]
  4. Margarita Katsimi & Thomas Moutos, 2005. "Inequality and Relative Reliance on Tariffs: Theory and Evidence," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
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