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Does Bilateralism Promote Trade? Nineteenth Century Liberalization Revisited

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  • Accominotti, Olivier
  • Flandreau, Marc

Abstract

Textbook accounts of the Anglo-French trade agreement of 1860 argue that it heralded the beginning of a liberal trading order. This alleged success has much interest from a policy point of view: unlike modern GATT/WTO multilateral agreements, it rested on bilateral negotiations. But, in reality, how great were its effects? With the help of new data on international trade we provide empirical evidence. We find that the Anglo-French treaty and subsequent network of Most Favoured Nation (MFN) trade agreements coincided with the end of a period of unilateral liberalization across the world, and that it did not contribute to expand trade at all. This is contrary to a deeply rooted belief among economists and economic historians. We conclude that, contrary to a popular wisdom, bilateralism did not promote trade in the 19th century.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 5423.

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Date of creation: Dec 2005
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Handle: RePEc:cpr:ceprdp:5423

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Keywords: Anglo-French treaty; bilateralism; liberalization; MFN; multilateralism; trade policy;

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References

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Citations

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Cited by:
  1. Jacks, David S; Meissner, Christopher; Novy, Dennis, 2010. "Trade Booms, Trade Busts and Trade Costs," CAGE Online Working Paper Series, Competitive Advantage in the Global Economy (CAGE) 33, Competitive Advantage in the Global Economy (CAGE).
  2. Tena-Junguito, Antonio & Lampe, Markus & Fernandes, Felipe Tâmega, 2012. "How Much Trade Liberalization Was There in the World Before and After Cobden-Chevalier?," The Journal of Economic History, Cambridge University Press, Cambridge University Press, vol. 72(03), pages 708-740, September.
  3. Guillaume Daudin & Kevin H. O’Rourke & Leandro Prados de la Escosura, 2008. "Trade and Empire, 1700-1870," Documents de Travail de l'OFCE, Observatoire Francais des Conjonctures Economiques (OFCE) 2008-24, Observatoire Francais des Conjonctures Economiques (OFCE).
  4. Jacks, David S. & Meissner, Christopher M. & Novy, Dennis, 2010. "Trade costs in the first wave of globalization," Explorations in Economic History, Elsevier, Elsevier, vol. 47(2), pages 127-141, April.
  5. repec:spo:wpecon:info:hdl:2441/6149 is not listed on IDEAS
  6. Kris James Mitchener & Marc Weidenmier, 2008. "Trade and Empire," NBER Working Papers 13765, National Bureau of Economic Research, Inc.
  7. Gerhard Kling & Joerg Baten & Kirsten Labuske, 2011. "FDI of German Companies During Globalization and Deglobalization," Open Economies Review, Springer, Springer, vol. 22(2), pages 247-270, April.

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