IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/3476.html
   My bibliography  Save this paper

Welfare and Customs Unions

Author

Listed:
  • Carsten Kowalczyk

Abstract

This paper proposes that Viner's celebrated trade diversion and trade creation terminology for the customs union problem be abandoned. As the alternative is offered a welfare calculus based upon the terms-of-trade and volume-of-trade taxonomy from the theory of tariffs. The paper discusses, by application of this calculus, the two outstanding controversies in the theory of customs unions.

Suggested Citation

  • Carsten Kowalczyk, 1990. "Welfare and Customs Unions," NBER Working Papers 3476, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:3476
    Note: ITI IFM
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w3476.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Raymond RIEZMAN, 2013. "Customs Unions and the Core," World Scientific Book Chapters, in: Raymond Riezman (ed.), International Trade Agreements and Political Economy, chapter 3, pages 33-43, World Scientific Publishing Co. Pte. Ltd..
    2. John Kennan & Raymond Riezman, 2013. "Optimal Tariff Equilibria with Customs Unions," World Scientific Book Chapters, in: Raymond Riezman (ed.), International Trade Agreements and Political Economy, chapter 5, pages 53-66, World Scientific Publishing Co. Pte. Ltd..
    3. Raymond RIEZMAN, 2013. "A 3 × 3 Model of Customs Unions," World Scientific Book Chapters, in: Raymond Riezman (ed.), International Trade Agreements and Political Economy, chapter 1, pages 7-20, World Scientific Publishing Co. Pte. Ltd..
    4. John Kennan & Raymond Riezman, 2013. "Do Big Countries Win Tariff Wars?," World Scientific Book Chapters, in: Raymond Riezman (ed.), International Trade Agreements and Political Economy, chapter 4, pages 45-51, World Scientific Publishing Co. Pte. Ltd..
    5. Franz Gehrels, 1956. "Customs Union from a Single-Country Viewpoint," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 24(1), pages 61-64.
    6. Appleyard, Dennis R. & Conway, Patrick J. & Field, Alfred Jr., 1989. "The effects of customs unions on the pattern and terms of trade in a Ricardian model with a continuum of goods," Journal of International Economics, Elsevier, vol. 27(1-2), pages 147-164, August.
    7. Harry G. Johnson, 1965. "An Economic Theory of Protectionism, Tariff Bargaining, and the Formation of Customs Unions," Journal of Political Economy, University of Chicago Press, vol. 73(3), pages 256-256.
    8. Wonnacott, Paul & Wonnacott, Ronald, 1984. "How General Is the Case for Unilateral Tariff Reduction?," American Economic Review, American Economic Association, vol. 74(3), pages 491-491, June.
    9. Bond, Eric W, 1990. "The Optimal Tariff Structure in Higher Dimensions," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 31(1), pages 103-116, February.
    10. Kirman, Alan P, 1973. "Trade Diverting Customs Unions and Welfare Improvement: A Comment," Economic Journal, Royal Economic Society, vol. 83(331), pages 890-894, September.
    11. Conway, Patrick J & Appleyard, Dennis R & Field, Alfred J, Jr, 1989. "Trade Agreements vs. Unilateral Tariff Reductions: Evidence from Modeling with a Continuum of Goods," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 30(4), pages 775-794, November.
    12. Michaely, Michael, 1976. "The assumptions of Jacob Viner's theory of customs unions," Journal of International Economics, Elsevier, vol. 6(1), pages 75-93, 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. Carsten Kowalczyk & Raymond Riezman, 2013. "Trade Agreements," Palgrave Macmillan Books, in: Daniel Bernhofen & Rod Falvey & David Greenaway & Udo Kreickemeier (ed.), Palgrave Handbook of International Trade, chapter 13, pages 367-388, Palgrave Macmillan.
    2. Raymond Riezman, 1999. "Can Bilateral Trade Agreements Help Induce Free Trade," Canadian Journal of Economics, Canadian Economics Association, vol. 32(3), pages 751-766, May.
    3. Norman S. Fieleke, 1992. "One trading world, or many: the issue of regional trading blocs," New England Economic Review, Federal Reserve Bank of Boston, issue May, pages 3-20.
    4. Baldwin, Richard, 2008. "Big-Think Regionalism: a Critical Survey," CEPR Discussion Papers 6874, C.E.P.R. Discussion Papers.
    5. Jiandong Ju & Kala Krishna, 2005. "Firm behaviour and market access in a Free Trade Area with rules of origin," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 38(1), pages 290-308, February.
    6. Paul Brenton & Natalia Tonrdyeva & Jhon Whalley, 2014. "The Potential Trade Effects of an FTA between the EU and Russia," World Scientific Book Chapters, in: INTERNATIONAL TRADE, DISTRIBUTION AND DEVELOPMENT Empirical Studies of Trade Policies, chapter 5, pages 83-103, World Scientific Publishing Co. Pte. Ltd..
    7. Arvind Panagariya, 2003. "Preferential Trading and Welfare: The Small-Union Case Revisited," International Trade 0308009, University Library of Munich, Germany.
    8. Carsten Kowalczyk, 1992. "Paradoxes in integration theory," Open Economies Review, Springer, vol. 3(1), pages 51-59, February.
    9. Jiandong Ju & Kala Krishna, "undated". "Market Access and Welfare Effects of Free Trade Areas without Rules of Origin," EPRU Working Paper Series 96-03, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
    10. Carsten Kowalczyk & Tomas Sjostrom, 1993. "Bringing GATT into the Core," NBER Working Papers 4343, National Bureau of Economic Research, Inc.
    11. Bagwell, Kyle & Staiger, Robert W., 1997. "Multilateral tariff cooperation during the formation of customs unions," Journal of International Economics, Elsevier, vol. 42(1-2), pages 91-123, February.
    12. Kyle Bagwell & Robert W. Staiger, 1993. "Multilateral Tarriff Cooperation During the Formation of Regional Free Trade Areas," NBER Working Papers 4364, National Bureau of Economic Research, Inc.
    13. P. J. Lloyd, 1993. "Global Integration," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 26(1), pages 35-48, January.
    14. Carsten Kowalczyk & Ronald J. Wonnacott, 1992. "Hubs and Spokes, and Free Trade in the Americas," NBER Working Papers 4198, National Bureau of Economic Research, Inc.
    15. Mavroidis, Petros C., 2011. "Always look at the bright side of non-delivery: WTO and Preferential Trade Agreements, yesterday and today," World Trade Review, Cambridge University Press, vol. 10(3), pages 375-387, July.
    16. Bagwell, Kyle & Staiger, Robert W, 1997. "Multilateral Tariff Cooperation during the Formation of Free Trade Areas," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(2), pages 291-319, May.
    17. Hoekman, Bernard & Djankov, Simeon, 1997. "Effective protection and investment incentives in Egypt and Jordan during the transition to free trade With Europe," World Development, Elsevier, vol. 25(2), pages 281-291, February.
    18. Arvind Panagariya, 2000. "Preferential Trade Liberalization: The Traditional Theory and New Developments," Journal of Economic Literature, American Economic Association, vol. 38(2), pages 287-331, June.
    19. Carsten Kowalczyk, 1994. "Norway: The Trade Effects of European Integration: A Comment," The World Economy, Wiley Blackwell, vol. 17(5), pages 697-700, September.

    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. Hideo Konishi & Carsten Kowalczyk & Tomas Sjostrom, 2003. "Free Trade, Customs Unions, and Transfers," Boston College Working Papers in Economics 568, Boston College Department of Economics.
    2. Carsten Kowalczyk & Raymond Riezman, 2013. "Trade Agreements," Palgrave Macmillan Books, in: Daniel Bernhofen & Rod Falvey & David Greenaway & Udo Kreickemeier (ed.), Palgrave Handbook of International Trade, chapter 13, pages 367-388, Palgrave Macmillan.
    3. Lisandro Abrego & Raymond Riezman & John Whalley, 2006. "How reasonable are assumptions used in theoretical models? Computational evidence on the likelihood of trade pattern changes," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 39(3), pages 781-789, August.
    4. Chichilnisky, Graciela, 1996. "Trade regimes and Gatt: resource intensive vs. knowledge intensive growth, Chapter 10," MPRA Paper 8813, University Library of Munich, Germany.
    5. de Melo, Jaime & Montenegro, Claudio & Panagariya, Arvind, 1992. "Regional integration, old and new," Policy Research Working Paper Series 985, The World Bank.
    6. Richard Baldwin, 2008. "Big-Think Regionalism: A Critical Survey," NBER Working Papers 14056, National Bureau of Economic Research, Inc.
    7. Bond, Eric W. & Syropoulos, Constantinos, 1996. "The size of trading blocs Market power and world welfare effects," Journal of International Economics, Elsevier, vol. 40(3-4), pages 411-437, May.
    8. Lisandro Abrego & Raymond Riezman & John Whalley, 2002. "How Often Are Propositions On The Effects Of Regional Trade Agreements Theoretical Curiosa And When Should They Guide Policy?," University of Western Ontario, Departmental Research Report Series 20024, University of Western Ontario, Department of Economics.
    9. Carsten Kowalczyk & Raymond Riezman, 2013. "Free trade: what are the terms-of-trade effects?," World Scientific Book Chapters, in: Raymond Riezman (ed.), International Trade Agreements and Political Economy, chapter 10, pages 149-164, World Scientific Publishing Co. Pte. Ltd..
    10. Carsten Kowalczyk & Tomas Sjostrom, 1993. "Bringing GATT into the Core," NBER Working Papers 4343, National Bureau of Economic Research, Inc.
    11. Pokrivcak, Jan, 2007. "Economics and Political Economy of Regional Trade Agreements," Working Papers 7286, TRADEAG - Agricultural Trade Agreements.
    12. Lisandro Abrego & Raymond Riezman & John Whalley, 2013. "How often are propositions on the effects of regional trade agreements theoretical curiosa?," World Scientific Book Chapters, in: Raymond Riezman (ed.), International Trade Agreements and Political Economy, chapter 9, pages 129-148, World Scientific Publishing Co. Pte. Ltd..
    13. M. Ayhan Kose & Raymond Riezman, 2000. "Small Countries and Preferential Trade Agreements "How Severe is the Innocent Bystander Problem?"," CESifo Working Paper Series 253, CESifo.
    14. Lisandro Abrego & Raymond Riezman & John Whalley, 2001. "How Often Are Propositions on the Effects of Customs Unions Theoretical Curiosa and When Should They Guide Policy?," NBER Working Papers 8304, National Bureau of Economic Research, Inc.
    15. Saggi, Kamal & Wong, Woan Foong & Yildiz, Halis Murat, 2017. "Preferential Trade Agreements and Rules of the Multilateral Trading System," MPRA Paper 76330, University Library of Munich, Germany.
    16. Chichilnisky, Graciela, 1992. "Strategies for trade liberalization in the Americas," Sede de la CEPAL en Santiago (Estudios e Investigaciones) 33919, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    17. Winters, L. Alan, 1996. "Regionalism versus Multilateralism," CEPR Discussion Papers 1525, C.E.P.R. Discussion Papers.
    18. Inés Macho‐Stadler & Licun Xue, 2007. "Winners and Losers from the Gradual Formation of Trading Blocs," Economica, London School of Economics and Political Science, vol. 74(296), pages 664-681, November.
    19. Sang-Seung, Yi, 1996. "Endogenous formation of customs unions under imperfect competition: open regionalism is good," Journal of International Economics, Elsevier, vol. 41(1-2), pages 153-177, August.
    20. Kyle Bagwell & Robert W. Staiger, 1993. "Multilateral Tarriff Cooperation During the Formation of Regional Free Trade Areas," NBER Working Papers 4364, National Bureau of Economic Research, Inc.

    More about this item

    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:nbr:nberwo:3476. 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: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.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.