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Common External Tariff Choice in Core Customs Unions

Author

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  • Mark Melatos
  • Alan Woodland

Abstract

This paper investigates how customs union members select the common external tariff (CET) to levy on imports from nonmembers. A perfectly competitive, pure exchange, general‐equilibrium model of world trade is simulated. Contrary to most previous work, countries have the freedom to share authority over CET choice and to select from a variety of possible coalition forms. The results confirm that when customs unions are observed in the core, members may wish to share responsibility for CET choice in a variety of ways. Generally, however, the member country that is relatively well‐endowed or has relatively elastic consumer preferences tends to take the lead in CET choice.

Suggested Citation

  • Mark Melatos & Alan Woodland, 2009. "Common External Tariff Choice in Core Customs Unions," Review of International Economics, Wiley Blackwell, vol. 17(2), pages 292-303, May.
    • Handle: RePEc:bla:reviec:v:17:y:2009:i:2:p:292-303
    DOI: 10.1111/j.1467-9396.2009.00824.x
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    Cited by:

    1. Caroline Freund & Emanuel Ornelas, 2010. "Regional Trade Agreements," Annual Review of Economics, Annual Reviews, vol. 2(1), pages 139-166, September.
    2. Ornelas, Emanuel & Tovar, Patricia, 2022. "Intra-bloc tariffs and preferential margins in trade agreements," Journal of International Economics, Elsevier, vol. 138(C).
    3. James Lake, 2019. "Dynamic formation of preferential trade agreements: The role of flexibility," Canadian Journal of Economics, Canadian Economics Association, vol. 52(1), pages 132-177, February.

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