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EU Enlargement and Beyond: A Simulation Study on EU and Russia Integration

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Author Info
Sulamaa, Pekka
Widgrén, Mika

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Abstract

This Paper examines the economic effects of the opening of the former Soviet Union. The analysis carried out in the Paper is two-fold. First we simulate the impact of the eastern enlargement of the EU and, second, we analyse how deeper integration between the EU and Russia contributes to this. The analysis is carried out with GTAP computable general equilibrium model. We find that there is a trade-off between the two roads of European integration arrangements. Eastern enlargement seems, even in its very deep form, to be beneficial for all EU regions without causing substantial welfare losses outside the Union. EU-Russia integration, on the other hand, has a different impact. To be beneficial for Russia, free trade between the EU and Russia requires improved productivity in the latter, which may be due to better institutions or increased FDI. This might make the negotiations of the agreement cumbersome and, if agreed, its implementation difficult.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 4720.

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Date of creation: Oct 2004
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Handle: RePEc:cpr:ceprdp:4720

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Related research
Keywords: european integration; GTAP model; trade;

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Find related papers by JEL classification:
F14 - International Economics - - Trade - - - Country and Industry Studies of Trade
F15 - International Economics - - Trade - - - Economic Integration
F17 - International Economics - - Trade - - - Trade Forecasting and Simulation

This paper has been announced in the following NEP Reports:

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.:
  1. Risto Vaittinen, 2003. "Liberalisation of Agricultural Trade - Global Implications and what it Means for the EU," Discussion Papers 303, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  2. Kari Hämäläinen, 2003. "Education and Unemployment: State Dependence in Unemployment Among Young People in the 1990s," Discussion Papers 312, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  3. Jaakko Kiander, 2004. "Growth and Employment in Nordic Welfare States in the 1990s: a Tale of Crisis and Revival," Discussion Papers 336, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  4. Seppo Kari & Jouko Ylä-Liedenpohja, 2004. "Effects of Equalization Tax on Multinational Investments and Transfer Pricing," Discussion Papers 337, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  5. Sapir, André, 1997. "The Political Economy of EC Regionalism," CEPR Discussion Papers 1739, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  6. Takis Venetoklis & Aki Kangasharju, 2003. "Do Wage-subsidies Increase Employment in Firms?," Discussion Papers 304, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  7. Thomas W. Hertel & Padma Swaminathan, 1996. "Introducing Monopolistic Competition into the GTAP Model," GTAP Technical Papers 309, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University. [Downloadable!]
  8. Virve Ollikainen, 2003. "The Determinants of Unemployment Duration by Gender in Finland," Discussion Papers 316, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  9. Heikki Räisänen, 2003. "How to Cope with Labour Market Policy Tools in Economic Downturn: Finnish Evidence," Discussion Papers 305, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  10. Per Pettersson-Lidbom, 2004. "Does the Size of the Legislature Affect the Size of Government? Evidence from Two Natural Experiments," Discussion Papers 350, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  11. Pekka Sinko, 2004. "Progressive Taxation Under Centralised Wage Setting," Discussion Papers 349, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  12. Sari Pekkala, 2003. "Is Little Brother Nothing but Trouble?: Educational Attainment, Returns to Schooling and Sibling Structure," Discussion Papers 302, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  13. Sulamaa, Pekka & Widgrén, Mika, 2003. "EU Enlargement and Beyond: A Simulation Study on EU and CIS Integration," CEPR Discussion Papers 3768, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  14. Dr. Peter Kenning & Hilke Plassmann, 2004. "NeuroEconomics," Experimental 0412005, EconWPA. [Downloadable!]
  15. Adriaan Perrels, 2004. "The Basic Service Quality Level of Transport Infrastructure in Peripheral Areas," Discussion Papers 335, Government Institute for Economic Research Finland (VATT). [Downloadable!]
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  16. Jaakko Kiander, 2004. "The Evolution of the Finnish Model in the 1990s: from Depression to High-tech Boom," Discussion Papers 344, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  17. Pekka Sinko, 2003. "Subsidizing vs. Experience Rating of Unemployment Insurance in Unionized Labor Markets," Discussion Papers 319, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  18. Kyyrä, Tomi & Wilke, Ralf A., 2004. "Reduction in the Long-Term Unemployment of the Elderly : A Success Story from Finland," ZEW Discussion Papers 04-63, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
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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. Ville Kaitila, 2007. "Free Trade between the EU and Russia - Sectoral Effects and Impacts on Northwest Russia," Discussion Papers 1087, The Research Institute of the Finnish Economy. [Downloadable!]
  2. Pekka Sulamaa & Mika Widgrén, 2005. "Economic Effects of Free Trade between the EU and Russia," Economics Working Papers 036, European Network of Economic Policy Research Institutes. [Downloadable!]
    Other versions:
  3. Kari E.O. Alho & Ville Kaitila & Mika Widgrén, 2004. "Speed of Convergence and Relocation: New EU Member Countries Catching up with the Old," Discussion Papers 963, The Research Institute of the Finnish Economy. [Downloadable!]
    Other versions:
  4. Pekka Sulamaa & Mika Widgrén, 2005. "Asian Regionalism versus Global Free Trade: A Simulation Study on Economic Effects," Discussion Papers 985, The Research Institute of the Finnish Economy. [Downloadable!]
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