Large Countries, Small Countries, and the Enlargement of Trade Blocs
AbstractAre there systematic forces such that countries of different sizes participating in a free trade bloc gain differently from the entry of new members? If economies of scale imply that firms located in large countries enjoy lower costs, then the gains from enlarging the bloc will fall disproportionately on small countries, because the entry of new members diminishes the importance of the domestic market and improves the small countries' relative competitiveness. The theoretical prediction is clear, but the empirical analysis of trade flows towards Spain and Portugal after their 1986 entry into the European Community yields mixed results. France and the U.K. appear to have lost market shares relative to the small countries in the Community, but the same is not true for Italy and, to a lesser degree, for Germany.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 5365.
Date of creation: Nov 1995
Date of revision:
Publication status: published as European Economic Review, vol. 40, no. 2, pp. 389-415, February 1996
Contact details of provider:
Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Web page: http://www.nber.org
More information through EDIRC
Other versions of this item:
- Casella, Alessandra, 1996. "Large countries, small countries and the enlargement of trade blocs," European Economic Review, Elsevier, vol. 40(2), pages 389-415, February.
- Casella, Alessandra, 1996. "Large Countries, Small Countries and the Enlargement of Trade Blocs," CEPR Discussion Papers 1320, C.E.P.R. Discussion Papers.
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- F15 - International Economics - - Trade - - - Economic Integration
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.:
- Widgrén, Mika, 1994. "The Relation Between Voting Power and Policy Impact in the European Union," CEPR Discussion Papers 1033, C.E.P.R. Discussion Papers.
- Flam, Harry & Helpman, Elhanan, 1987. "Industrial policy under monopolistic competition," Journal of International Economics, Elsevier, vol. 22(1-2), pages 79-102, February.
- Widgren, Mika, 1994.
"Voting power in the EC decision making and the consequences of two different enlargements,"
European Economic Review,
Elsevier, vol. 38(5), pages 1153-1170, May.
- Widgren, Mika, 1991. "Voting Power in the EC Decision Making and the Consequencesof two Different Enlargements," Discussion Papers 377, The Research Institute of the Finnish Economy.
- J. N. Bhagwati & R. A. Brecher, 1979.
"Foreign Ownership and the Theory of Trade and Welfare,"
249, Massachusetts Institute of Technology (MIT), Department of Economics.
- Brecher, Richard A & Bhagwati, Jagdish N, 1981. "Foreign Ownership and the Theory of Trade and Welfare," Journal of Political Economy, University of Chicago Press, vol. 89(3), pages 497-511, June.
- Wellisch, Dietmar & Wildasin, David E., 1996. "Decentralized income redistribution and immigration," European Economic Review, Elsevier, vol. 40(1), pages 187-217, January.
- Frankel, Jeffrey & Stein, Ernesto & Wei, Shang-jin, 1995. "Trading blocs and the Americas: The natural, the unnatural, and the super-natural," Journal of Development Economics, Elsevier, vol. 47(1), pages 61-95, June.
- Jeffrey A. Frankel & Ernesto Stein & Shang-Jin Wei, 1993.
"Continental Trading Blocs: Are They Natural, or Super-Natural?,"
NBER Working Papers
4588, National Bureau of Economic Research, Inc.
- Jeffrey A. Frankel & Ernesto Stein & Shang-Jin Wei, 1998. "Continental Trading Blocs: Are They Natural or Supernatural?," NBER Chapters, in: The Regionalization of the World Economy, pages 91-120 National Bureau of Economic Research, Inc.
- Basevi, Giorgio, 1970. "Domestic Demand and Ability to Export," Journal of Political Economy, University of Chicago Press, vol. 78(2), pages 330-37, March-Apr.
- Richard Baldwin, 1993.
"A Domino Theory of Regionalism,"
NBER Working Papers
4465, National Bureau of Economic Research, Inc.
- Krugman, Paul, 1991.
"Increasing Returns and Economic Geography,"
Journal of Political Economy,
University of Chicago Press, vol. 99(3), pages 483-99, June.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.