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Do South-South Trade Agreements Increase Trade? Commodity-Level Evidence from COMESA

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  • Anna Maria Mayda

    ()
    (Georgetown University and Centro Studi Luca d\'Agliano)

  • Chad Steinberg

    (International Monetary Fund)

Abstract

South-South trade agreements are proliferating: Developing countries signed 70 new agreements between 1990 and 2003. Yet the impact of these agreements is largely unknown, as existing North- North and North-South micro-level studies are likely to yield misleading predictions for South-South trade agreements. This paper focuses on the static effects of South-South preferential trade agreements stemming from changes in trade patterns. Specifically, it estimates the impact of the Common Market for Eastern and Southern Africa (COMESA) on Uganda’s imports between 1994 and 2003. Detailed import and tariff data at the 6-digit harmonized system level are used for more than 1,000 commodities. Based on a difference-in-difference estimation strategy, the paper finds that—in contrast to evidence from aggregate statistics—COMESA’s preferential tariff liberalization has not considerably increased Uganda’s trade with member countries, on average across sectors. The effect, however, is heterogeneous across sectors. Finally, the paper finds no evidence of trade diversion effects.

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Bibliographic Info

Paper provided by Centro Studi Luca d\'Agliano, University of Milano in its series Development Working Papers with number 247.

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Length: 45
Date of creation: 30 Jun 2008
Date of revision:
Handle: RePEc:csl:devewp:247

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Keywords: South-South trade agreements; trade creation; trade diversion;

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  25. repec:fth:inadeb:323 is not listed on IDEAS
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Cited by:
  1. Jane Korinek & Mark Melatos, 2009. "Trade Impacts of Selected Regional Trade Agreements in Agriculture," OECD Trade Policy Papers 87, OECD Publishing.
  2. Mia Mikic, 2007. "Trends in preferential trade liberalization in Asia and the Pacific," STUDIES IN TRADE AND INVESTMENT, in: Studies in Trade and Investment - AGRICULTURAL TRADE - PLANTING THE SEEDS OF REGIONAL LIBERALIZATION IN ASIA, volume 60, pages 1-32 United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
  3. Omar S. Dahi & Firat Demir, 2013. "Preferential trade agreements and manufactured goods exports: does it matter whom you PTA with?," Applied Economics, Taylor & Francis Journals, vol. 45(34), pages 4754-4772, December.

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