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Trade Diversion in the 'Left-Outs' in the Eastward Enlargement of the European Union

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  • Fidrmuc, Jarko

    (Department of Economics, Institute for Advanced Studies)

Abstract

I analyze three scenarios including no Eastward enlargement of the EU and the accession of Central European countries including and excluding Slovakia. The formulation of these scenarios is derived from the evidence on former relations between EU and EFTA as estimated by gravity models for total trade and major SITC one-digit commodity groups. A significant part of Slovakia's extraordinary trade relations with the Czech Republic will diminish if the country does not participate in the first wave of Eastward enlargement of the EU. These export losses can be compensated by export gains to Hungary and Poland.

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File URL: http://www.ihs.ac.at/publications/tec/te-8.pdf
File Function: First version, 1999
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Bibliographic Info

Paper provided by Institute for Advanced Studies in its series Transition Economics Series with number 8.

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Length: 16 pages
Date of creation: Apr 1999
Date of revision:
Handle: RePEc:ihs:ihstep:8

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Related research

Keywords: Trade predictions; Gravity model; Eastern enlargement of the EU; Slovakia;

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References

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  1. Paul Krugman, 1990. "Increasing Returns and Economic Geography," NBER Working Papers 3275, National Bureau of Economic Research, Inc.
  2. Hamilton, C.B. & Winters, L.A., 1992. "Opening Up International Trade in Eastern Europe," Papers 511, Stockholm - International Economic Studies.
  3. Baldwin, Richard, 1993. "The Potential for Trade Between the Countries of EFTA and Central and Eastern Europe," CEPR Discussion Papers 853, C.E.P.R. Discussion Papers.
  4. Krugman, Paul, 1991. "History versus Expectations," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 651-67, May.
  5. Tamim Bayoumi & Barry J. Eichengreen, 1995. "Is Regionalism Simply a Diversion? Evidence from the Evolution of the EC and EFTA," IMF Working Papers 95/109, International Monetary Fund.
  6. Robert Holzmann & Christian Thimann & Angela Petz, 1994. "Pressure to Adjust: Consequences for the OECD Countries from Reforms in Eastern Europe," International Trade 9403001, EconWPA.
  7. Markusen, James R & Wigle, Randall M, 1990. "Explaining the Volume of North-South Trade," Economic Journal, Royal Economic Society, vol. 100(403), pages 1206-15, December.
  8. 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.
  9. Markusen, James R, 1986. "Explaining the Volume of Trade: An Eclectic Approach," American Economic Review, American Economic Association, vol. 76(5), pages 1002-11, December.
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Citations

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Cited by:
  1. Fidrmuc, Jan & Fidrmuc, Jarko, 2000. "Disintegration and Trade," CEPR Discussion Papers 2641, C.E.P.R. Discussion Papers.
  2. Fidrmuc, J. & Fidrmuc, J., 2000. "Integration, Disintegration and Trade in Europe: Evolution of Trade Relations during the 1990s," Discussion Paper 2000-12, Tilburg University, Center for Economic Research.
  3. J. Fidrmuc & J. Fidrmuc, 2000. "Macroeconomic Developments in Slovakia and the EU Accession Process," Working Papers ir00007, International Institute for Applied Systems Analysis.
  4. Fidrmuc, Jan & Horvath, Julius & Fidrmuc, Jarko, 1999. "Stability of Monetary Unions: Lessons from the Break-up of Czechoslovakia," Transition Economics Series 10, Institute for Advanced Studies.
  5. J. Fidrmuc & J. Fidrmuc, 2000. "Macroeconomic Developments in the Czech Republic and the EU Accession Process," Working Papers ir00008, International Institute for Applied Systems Analysis.

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