Kokko, Ari () (European Institute of Japanese Studies) Mathä, Thomas () (Central Bank of Luxembourg) Gustavsson Tingvall, Patrik () (European Institute of Japanese Studies)
Additional information is available for the following
registered author(s):
This paper re-examines the relation between regional integration and trade by using the framework suggested by Yeats [1998] to analyze the effects of European integration. We identify the industries that experienced the largest increases in regional trade orientation during three phases of European integration, and examine the simultaneous changes in revealed comparative advantages. Our main conclusion is that there are signs of trade diversion for the earliest phase of European integration (1962-1973), when intra-regional trade increased in industries with weak comparative advantages, but not for later time periods. The main reason is that regional integration has coincided with reductions in external trade barriers, improving market access also for outsiders. At the same time, integration has promoted economic growth and import demand, which has been beneficial for outside producers. We also argue that the static concept of trade diversion is not well suited for analyzing modern integration, which aims to raise the comparative advantage of regional producers by promoting scale economies and competition. If successful, it will reduce the market shares of outsiders, but it does not constitute trade diversion: more efficient outsiders are not replaced by less efficient insiders.
Download Info
To our knowledge, this item is not available for
download. To find whether it is available, there are three
options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page
whether it is in fact available.
3. Perform a search for a similarly titled item that would be
available.
Publisher Info
Paper provided by The European Institute of Japanese Studies in its series EIJS Working Paper Series with number
231.
Length: 41 pages Date of creation: 01 Dec 2006 Date of revision: Publication status: Published in Integration & Trade, 2007, pages 205-246. Handle: RePEc:hhs:eijswp:0231
Contact details of provider: Postal: The European Institute of Japanese Studies, Stockholm School of Economics, P.O. Box 6501, 113 83 Stockholm, Sweden Phone: +46-8-7369360 Fax: +46-8-313017 Email: Web page: http://www.hhs.se/eijs/ More information through EDIRC
For technical questions regarding this item, or to correct its listing, contact: (Nanhee Lee).
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.: