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The Endogeneity of Association Agreements and their Impact on Trade for Eastern Countries: Empirical Evidence for Romania

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Author Info

  • Christophe RAULT

    ()

  • Ana Maria SOVA

    ()

  • Robert SOVA

    ()

Abstract

The main goal of regionalization is the creation of free trade areas and the guarantee for countries to accede to a widened market. Many studies dealing with the effects of regional free trade agreements on trade flows already exist in the economic literature and the explosion of regional agreements among nations has recently stressed the key role of regionalization. However, the effects of agreements on trade have not yet been clearly determined in those studies. Our research in this paper aims at reassessing the genuine role of associations. For this matter, we particularly study the association of Romania with European Union countries. Our econometric analysis based on qualitative choice models highlights in particular why European countries chose to conclude an association agreement with Romania, and stresses the fact that European Union countries select endogenously the conclusion of association agreements. We also find a 0.29 positive impact of the association agreement on Romanian export performances.

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Bibliographic Info

Paper provided by William Davidson Institute at the University of Michigan in its series William Davidson Institute Working Papers Series with number wp868.

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Length: pages
Date of creation: 01 Apr 2007
Date of revision:
Handle: RePEc:wdi:papers:2007-868

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Related research

Keywords: Regionalization; European integration; Qualitative choice models; Probit;

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Cited by:
  1. Caporale, Guglielmo Maria & Rault, Christophe & Sova, Anamaria & Sova, Robert, 2008. "On the Bilateral Trade Effects of Free Trade Agreements between the EU-15 and the CEEC-4 Countries," IZA Discussion Papers 3782, Institute for the Study of Labor (IZA).
  2. Christophe Rault & Robert Sova & Ana Maria Sova, 2008. "Modeling International Trade Flows between CEEC and OECD Countries," CESifo Working Paper Series 2282, CESifo Group Munich.

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