IDEAS home Printed from https://ideas.repec.org/p/mie/wpaper/529.html
   My bibliography  Save this paper

Globalization’s Bystanders: Does Trade Liberalization Hurt Countries that Do Not Participate?

Author

Listed:
  • Alan V. Deardorff

    (University of Michigan)

  • Robert M. Stern

    (University of Michigan)

Abstract

This paper uses trade theory to examine the effects of trade liberalization on countries that do not participate in it. These include both countries that fail to participate in multilateral trade negotiations, and also countries that lie outside of preferential trading arrangements such as free trade areas. The analysis suggests that, while it is theoretically possible for excluded countries to gain, through improved terms of trade, from trade liberalization, several reasons suggest that they are more likely to lose.

Suggested Citation

  • Alan V. Deardorff & Robert M. Stern, 2005. "Globalization’s Bystanders: Does Trade Liberalization Hurt Countries that Do Not Participate?," Working Papers 529, Research Seminar in International Economics, University of Michigan.
    • Handle: RePEc:mie:wpaper:529
    as

    Download full text from publisher

    File URL: http://fordschool.umich.edu/rsie/workingpapers/Papers526-550/r529.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Brown, Drusilla K. & Kiyota, Kozo & Stern, Robert M., 2005. "Computational analysis of the Free Trade Area of the Americas (FTAA)," The North American Journal of Economics and Finance, Elsevier, vol. 16(2), pages 153-185, August.
    2. Coe, David T. & Helpman, Elhanan, 1995. "International R&D spillovers," European Economic Review, Elsevier, vol. 39(5), pages 859-887, May.
    3. Won Chang & L. Alan Winters, 2015. "How Regional Blocs Affect Excluded Countries: The Price Effects of MERCOSUR," World Scientific Book Chapters, in: Non-Tariff Barriers, Regionalism and Poverty Essays in Applied International Trade Analysis, chapter 11, pages 199-214, World Scientific Publishing Co. Pte. Ltd..
    4. Baldwin, Richard E, 1992. "Measurable Dynamic Gains from Trade," Journal of Political Economy, University of Chicago Press, vol. 100(1), pages 162-174, February.
    5. Martin Richardson, 2017. "Tariff Revenue Competition in a Free Trade Area," World Scientific Book Chapters, in: Dimensions of Trade Policy, chapter 8, pages 171-181, World Scientific Publishing Co. Pte. Ltd..
    6. Mayer, Wolfgang, 1984. "Endogenous Tariff Formation," American Economic Review, American Economic Association, vol. 74(5), pages 970-985, December.
    7. Grossman, Gene M & Helpman, Elhanan, 1994. "Protection for Sale," American Economic Review, American Economic Association, vol. 84(4), pages 833-850, September.
    8. Ronald Findlay & Stanislaw Wellisz, 1982. "Endogenous Tariffs, the Political Economy of Trade Restrictions, and Welfare," NBER Chapters, in: Import Competition and Response, pages 223-244, National Bureau of Economic Research, Inc.
    9. Panagariya, Arvind & Krishna, Pravin, 2002. "On necessarily welfare-enhancing free trade areas," Journal of International Economics, Elsevier, vol. 57(2), pages 353-367, August.
    10. Kemp, Murray C. & Wan, Henry Jr., 1976. "An elementary proposition concerning the formation of customs unions," Journal of International Economics, Elsevier, vol. 6(1), pages 95-97, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Patrick Minford & Sakshi Gupta & Vo P.M. Le & Vidya Mahambare & Yongdeng Xu, 2015. "Should Britain Leave the EU?," Books, Edward Elgar Publishing, number 16679.
    2. Costantini, Valeria & Liberati, Paolo, 2014. "Technology transfer, institutions and development," Technological Forecasting and Social Change, Elsevier, vol. 88(C), pages 26-48.
    3. Bojnec, Stefan & Ferto, Imre, 2009. "Agro-food trade competitiveness of Central European and Balkan countries," Food Policy, Elsevier, vol. 34(5), pages 417-425, October.
    4. Mikic, Mia, 2007. "Preferential trade agreements and agricultural trade liberalization in Asia and the Pacific," MPRA Paper 2947, University Library of Munich, Germany.
    5. Chris Milner, 2006. "Making NAMA Work: Supporting Adjustment and Development," The World Economy, Wiley Blackwell, vol. 29(10), pages 1409-1422, October.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Subhayu Bandyopadhyay & Sajal Lahiri & Howard J. Wall, 2009. "Cross-border lobbying in preferential trading agreements: implications for external tariffs," Working Papers 2009-041, Federal Reserve Bank of St. Louis.
    2. Kyle Bagwell & Robert W. Staiger, 1999. "Multilateral Trade Negotiations, Bilateral Opportunism and the Rules of GATT," NBER Working Papers 7071, National Bureau of Economic Research, Inc.
    3. Emanuel Ornelas, 2012. "Preferential Trade Agreements and the Labor Market," CEP Discussion Papers dp1117, Centre for Economic Performance, LSE.
    4. Kyle Bagwell & Chad P. Bown & Robert W. Staiger, 2016. "Is the WTO Passé?," Journal of Economic Literature, American Economic Association, vol. 54(4), pages 1125-1231, December.
    5. Bandyopadhyay, Subhayu & Lahiri, Sajal, 2017. "Lobbying for a Common External Tariff from inside and out," International Review of Economics & Finance, Elsevier, vol. 50(C), pages 98-105.
    6. repec:ilo:ilowps:469183 is not listed on IDEAS
    7. Yasar, Mahmut, 2013. "Political Influence of Exporting and Import-Competing Firms: Evidence from Eastern European and Central Asian Countries," World Development, Elsevier, vol. 51(C), pages 154-168.
    8. Helpman, E., 1995. "Politics and Trade Policy," Papers 30-95, Tel Aviv - the Sackler Institute of Economic Studies.
    9. Winters, L. Alan, 1996. "Regionalism versus Multilateralism," CEPR Discussion Papers 1525, C.E.P.R. Discussion Papers.
    10. K. H. O'Rourke & R. Sinnott, 2001. "The Determinants of Individual Trade Policy Preferences: International Survey Evidence," Trinity Economics Papers 200110, Trinity College Dublin, Department of Economics.
    11. Joseph F. Francois & Gunnar Niels, 2004. "Political Influence in a New Antidumping Regime: Evidence from Mexico," Tinbergen Institute Discussion Papers 04-011/2, Tinbergen Institute.
    12. Pao-Li Chang, 2002. "Endogenous Tariff Formation with Intra-Industry Trade," Working Papers 476, Research Seminar in International Economics, University of Michigan.
    13. Bagwell,K. & Staiger,R.W., 2000. "GATT-think," Working papers 19, Wisconsin Madison - Social Systems.
    14. Gabriel Sánchez, 1998. "Lobbying, innovation and protectionist cycles," Economics Working Papers 272, Department of Economics and Business, Universitat Pompeu Fabra.
    15. Robert W. Staiger & Kyle Bagwell, 1999. "An Economic Theory of GATT," American Economic Review, American Economic Association, vol. 89(1), pages 215-248, March.
    16. Burfisher, Mary E. & Robinson, Sherman & Thierfelder, Karen, 2004. "Regionalism," MTID discussion papers 65, International Food Policy Research Institute (IFPRI).
    17. Christis G. Tombazos, 2003. "Unprotective Tariffs, Ineffective Liberalization, and Other Mysteries: An Investigation of the Endogenous Dimensions of Trade Policy Formation in Australia," Southern Economic Journal, John Wiley & Sons, vol. 70(1), pages 49-74, July.
    18. Lahiri, Sajal & Raimondos-Moller, Paschalis, 1999. "Special interest politics and aid fungibility," Economics Discussion Papers 10001, University of Essex, Department of Economics.
    19. Bond, Eric W. & Syropoulos, Constantinos & Winters, L. Alan, 2001. "Deepening of regional integration and multilateral trade agreements," Journal of International Economics, Elsevier, vol. 53(2), pages 335-361, April.
    20. Waschik, Robert, 2009. "The effects of free trade areas on non-members: Modelling Kemp-Vanek admissibility," Journal of Policy Modeling, Elsevier, vol. 31(5), pages 648-663, September.
    21. Mohammad Amin, 2004. "Time Inconsistency of Trade Policy and Multilateralism," International Trade 0402002, University Library of Munich, Germany.

    More about this item

    Keywords

    Trade liberalization; Globalization;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mie:wpaper:529. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: FSPP Webmaster (email available below). General contact details of provider: https://edirc.repec.org/data/riumius.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.