IDEAS home Printed from https://ideas.repec.org/p/zbw/cegedp/402.html
   My bibliography  Save this paper

The impact of FTAs on MENA exports of intermediate and final goods

Author

Listed:
  • Cardozo, Adriana R.
  • Martínez-Zarzoso, Inmaculada
  • Vogler, Paula L.

Abstract

This paper is the first to analyze the impact of free trade agreements (FTAs) and the harmonization of rules of origin (RoO) on Middle East and North African (MENA) countries' exports differentiating between final and intermediate goods for a global sample of trade partners. Data on exports from four MENA countries (Egypt, Jordan, Morocco and Tunisia) to 61 destinations over the period 1995-2016 are used to estimate a structural gravity model applying a Poisson Pseudo Maximum Likelihood (PPML) estimator. Moreover, the paper estimates the effect of the progressive adoption of the Pan-European-Mediterranean RoO. Results show that FTAs have been overall successful in increasing MENA exports. This is particularly truefor FTAs that eliminate protection on agricultural products. In contrast to the existing literature, we find that the agreements concluded with European countries raise MENA exports, whereas no significant impact is found for the application of the Pan-European RoO.

Suggested Citation

  • Cardozo, Adriana R. & Martínez-Zarzoso, Inmaculada & Vogler, Paula L., 2020. "The impact of FTAs on MENA exports of intermediate and final goods," University of Göttingen Working Papers in Economics 402, University of Goettingen, Department of Economics.
    • Handle: RePEc:zbw:cegedp:402
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/223245/1/1727944933.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Péridy, Nicolas & Abedini, Javad, 2008. "The Greater Arab Free Trade Area(GAFTA): an Estimation of Its Trade Effects," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 23, pages 848-872.
    2. Mario Larch & Joschka Wanner & Yoto V. Yotov & Thomas Zylkin, 2017. "The Currency Union Effect: A PPML Re-assessment with High-Dimensional Fixed Effects," CESifo Working Paper Series 6464, CESifo.
    3. Wood,Christina A. & Yang,Judy, 2016. "MENA export performance and specialization -- the role of financial sector development and governance," Policy Research Working Paper Series 7616, The World Bank.
    4. Magee Christopher S, 2003. "Endogenous Preferential Trade Agreements: An Empirical Analysis," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 2(1), pages 1-19, December.
    5. Baier, Scott L. & Yotov, Yoto V. & Zylkin, Thomas, 2019. "On the widely differing effects of free trade agreements: Lessons from twenty years of trade integration," Journal of International Economics, Elsevier, vol. 116(C), pages 206-226.
    6. James E. Anderson & Eric van Wincoop, 2004. "Trade Costs," Journal of Economic Literature, American Economic Association, vol. 42(3), pages 691-751, September.
    7. James E. Anderson & Eric van Wincoop, 2003. "Gravity with Gravitas: A Solution to the Border Puzzle," American Economic Review, American Economic Association, vol. 93(1), pages 170-192, March.
    8. Baier, Scott L. & Bergstrand, Jeffrey H., 2007. "Do free trade agreements actually increase members' international trade?," Journal of International Economics, Elsevier, vol. 71(1), pages 72-95, March.
    9. Athukorala, Prema-chandra & Yamashita, Nobuaki, 2006. "Production fragmentation and trade integration: East Asia in a global context," The North American Journal of Economics and Finance, Elsevier, vol. 17(3), pages 233-256, December.
    10. Cies´lik, Andrzej & Hagemejer, Jan, 2009. "Assessing the Impact of the EU-sponsored Trade Liberalization in the MENA Countries," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 24, pages 343-368.
    11. Thomas Chaney, 2008. "Distorted Gravity: The Intensive and Extensive Margins of International Trade," American Economic Review, American Economic Association, vol. 98(4), pages 1707-1721, September.
    12. M. D. Parra & I. Martinez-Zarzoso & C. Suárez-Burguet, 2016. "The impact of FTAs on MENA trade in agricultural and industrial products," Applied Economics, Taylor & Francis Journals, vol. 48(25), pages 2341-2353, May.
    13. Patricia Augier & Michael Gasiorek & Charles Lai‐Tong, 2004. "Rules of Origin and the EU‐Med Partnership: The Case of Textiles," The World Economy, Wiley Blackwell, vol. 27(9), pages 1449-1473, September.
    14. repec:hal:spmain:info:hdl:2441/6apm7lruv088iagm4rv2c33jtg is not listed on IDEAS
    15. Busse, Matthias & Gröning, Steffen, 2012. "Assessing the Impact of Trade Liberalization: The Case of Jordan," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 27, pages 466-486.
    16. Baier, Scott L. & Bergstrand, Jeffrey H. & Clance, Matthew W., 2018. "Heterogeneous effects of economic integration agreements," Journal of Development Economics, Elsevier, vol. 135(C), pages 587-608.
    17. Thomas Chaney, 2008. "Distorted Gravity: The Intensive and Extensive Margins of International Trade," Post-Print hal-03579844, HAL.
    Full references (including those not matched with items on IDEAS)

    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. Adriana Cardozo & Inmaculada Martínez‐Zarzoso & Paula L. Vogler, 2022. "The impact of free trade agreements on Middle East and North Africa exports of intermediate and final goods," The World Economy, Wiley Blackwell, vol. 45(5), pages 1501-1527, May.
    2. Rod Falvey & Neil Foster-McGregor, 2022. "The breadth of preferential trade agreements and the margins of exports," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 158(1), pages 181-251, February.
    3. Mario Larch & Yoto Yotov, 2017. "On the impact of TTIP in Southeastern and Eastern Europe: A quantitative analysis," Economic Thought journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 3, pages 54-73,74-92.
    4. Tamini, Lota D. & Chebbi, Houssem Eddine & Abbassi, Abdessalem, 2016. "Trade performance and potential of North African countries: An application of a stochastic frontier gravity model," AGRODEP working papers 33, International Food Policy Research Institute (IFPRI).
    5. Carl Gaigné & Lota D. Tamini, 2021. "Environmental Taxation and Import Demand for Environmental Goods: Theory and Evidence from the European Union," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 78(2), pages 307-352, February.
    6. Dutt, Pushan, 2020. "The WTO is not passé," European Economic Review, Elsevier, vol. 128(C).
    7. Zongo, Amara, 2021. "The impact of services trade restrictiveness on food trade," International Economics, Elsevier, vol. 166(C), pages 71-94.
    8. McDougall, Brendan S. & Afesorgbor, Sylvanus Kwaku, 2020. "The Effect of Free Trade Agreements on the Intensive and Extensive Margins of Canadian Agri-Food Trade," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304486, Agricultural and Applied Economics Association.
    9. Claudio Candia Campano & Medardo Aguirre González & Lilliam Antón López & Javier Beltrán Valdebenito, 2018. "A gravity model of trade for Nicaraguan agricultural exports," Revista Cuadernos de Economia, Universidad Nacional de Colombia, FCE, CID, vol. 37(74), pages 391-428, July.
    10. Anderson, James E. & Yotov, Yoto V., 2020. "Short run gravity," Journal of International Economics, Elsevier, vol. 126(C).
    11. Natalie Chen & Dennis Novy, 2022. "Gravity and Heterogeneous Trade Cost Elasticities," The Economic Journal, Royal Economic Society, vol. 132(644), pages 1349-1377.
    12. Maria Cipollina & David Laborde Debucquet & Luca Salvatici, 2017. "The tide that does not raise all boats: an assessment of EU preferential trade policies," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 153(1), pages 199-231, February.
    13. María Dolores Parra Robles & Inmaculada Martínez-Zarzoso & Celestino Suárez Burguet, 2012. "The impact of FTAs on MENA trade," Ibero America Institute for Econ. Research (IAI) Discussion Papers 217, Ibero-America Institute for Economic Research.
    14. Adu, Raymond & Litsios, Ioannis & Baimbridge, Mark, 2022. "ECOWAS single currency: Prospective effects on trade," Journal of International Money and Finance, Elsevier, vol. 126(C).
    15. Carl Gaigné & Lota D. Tamini, 2018. "Environmental regulation and eco-industry trade: Theory and evidence from the European Union," Working Papers SMART 18-09, INRAE UMR SMART.
    16. Kenta Yamanouchi, 2019. "Heterogeneous Impacts of Free Trade Agreements: The Case of Japan," Asian Economic Papers, MIT Press, vol. 18(2), pages 1-20, Summer.
    17. Heid, Benedikt & Larch, Mario, 2016. "Gravity with unemployment," Journal of International Economics, Elsevier, vol. 101(C), pages 70-85.
    18. Anderson, James E. & Borchert, Ingo & Mattoo, Aaditya & Yotov, Yoto V., 2018. "Dark costs, missing data: Shedding some light on services trade," European Economic Review, Elsevier, vol. 105(C), pages 193-214.
    19. Lee, Hyun-Hoon & Park, Donghyun & Wang, Jing, 2013. "Different types of firms, different types of products, and their dynamics: An anatomy of China's imports," China Economic Review, Elsevier, vol. 25(C), pages 62-77.
    20. Chen, Natalie & Novy, Dennis, 2017. "Currency unions, trade and heterogeneity," LSE Research Online Documents on Economics 88487, London School of Economics and Political Science, LSE Library.

    More about this item

    Keywords

    gravity model; FTA; MENA; PPML; panel data;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:zbw:cegedp:402. 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: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/cdgoede.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.