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Is Regionalism an Increasing Feature of the World Economy?


  • Richard Pomfret


Measuring the importance of regionalism in international trade is desirable but difficult. The number of regional trade agreements (RTAs) reported to the WTO or the proportion of world trade which is between countries in an RTA are frequently cited as evidence that regionalism is growing at an accelerating rate. This paper questions whether RTAs really are as important as the headline numbers suggest, or whether they just occupy an excessively large part of policymakers' and economic journalists' time. The main contributions are to analyse the number of RTAs and the share of world trade criteria in order to show why both are meaningless in the current world economy. The paper concludes that, although the extent of regionalism is difficult to measure and the desirability of individual RTAs is difficult to assess, the threat to the multilateral trading system does not appear to be as large as is often reported, because the long-term dynamics of RTAs lead either to state formation, which is important but rare, or to ineffectiveness, which is the fate of the vast majority of RTAs. Copyright 2007 The Author Journal compilation 2007 Blackwell Publishing Ltd .

Suggested Citation

  • Richard Pomfret, 2007. "Is Regionalism an Increasing Feature of the World Economy?," The World Economy, Wiley Blackwell, vol. 30(6), pages 923-947, June.
  • Handle: RePEc:bla:worlde:v:30:y:2007:i:6:p:923-947

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    References listed on IDEAS

    1. Baysan, Tercan & Panagariya, Arvind & Pitigala, Nihal, 2006. "Preferential trading in South Asia," Policy Research Working Paper Series 3813, The World Bank.
    2. Tubagus Feridhanusetyawan, 2005. "Preferential Trade Agreements in the Asia-Pacific Region," IMF Working Papers 05/149, International Monetary Fund.
    3. Pomfret, Richard, 1985. "Discrimination in International Trade: Extent, Motivation and Implications - La discriminazione nell’ambito del commercio internazionale: estensione, motivi e implicazioni," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 38(1), pages 49-65.
    4. GAULIER, Guillaume & LEMOINE, Francoise & UNAL-KESENCI, Deniz, 2007. "China's emergence and the reorganisation of trade flows in Asia," China Economic Review, Elsevier, vol. 18(3), pages 209-243.
    5. Dennis, Allen, 2006. "The impact of regional trade agreements and trade facilitation in the Middle East and North Africa region," Policy Research Working Paper Series 3837, The World Bank.
    6. Patrick Messerlin, 2005. "The Directive on Services: Rent Seekers Strike Back," Sciences Po publications info:hdl:2441/8131, Sciences Po.
    7. Linda Low, 2004. "A Comparative Evaluation and Prognosis of Asia Pacific Bilateral and Regional Trade Arrangements," Asian-Pacific Economic Literature, Asia Pacific School of Economics and Government, The Australian National University, vol. 18(1), pages 1-11, May.
    8. Patrick Messerlin, 2005. "The Directive on Services: Rent Seekers Strike Back," Post-Print hal-01020771, HAL.
    9. Pomfret, Richard, 2005. "Sequencing trade and monetary integration: issues and application to Asia," Journal of Asian Economics, Elsevier, vol. 16(1), pages 105-124, February.
    10. repec:spo:wpecon:info:hdl:2441/8131 is not listed on IDEAS
    11. Richard Pomfret, 2005. "Regional Trade Agreements," International Trade 0511002, EconWPA.
    12. Crawford, Jo-Ann & Fiorentino, Roberto V., 2005. "The changing landscape of regional trade agreements," WTO Discussion Papers 8, World Trade Organization (WTO), Economic Research and Statistics Division.
    13. Richard Pomfret, 1986. "The Trade-Diverting Bias of Preferential Trading Arrangements," Journal of Common Market Studies, Wiley Blackwell, vol. 25(2), pages 109-117, December.
    14. Schiff, Maurice & Winters, L Alan, 1998. "Dynamics and Politics in Regional Integration Arrangements: An Introduction," World Bank Economic Review, World Bank Group, vol. 12(2), pages 177-195, May.
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    Cited by:

    1. Pomfret, Richard & Sourdin, Patricia, 2009. "Have Asian trade agreements reduced trade costs?," Journal of Asian Economics, Elsevier, vol. 20(3), pages 255-268, May.
    2. Richard Pomfret, 2011. "Regional Integration in East Asia," Chapters,in: International Handbook on the Economics of Integration, Volume I, chapter 16 Edward Elgar Publishing.
    3. Sylvanus Kwaku Afesorgbor & Kaleb Girma Abreha, 2015. "Preferential Market Access, Foreign Aid and Economic Development," Economics Working Papers 2015-04, Department of Economics and Business Economics, Aarhus University.
    4. Jason H. Grant, 2013. "Is the growth of regionalism as significant as the headlines suggest? Lessons from agricultural trade," Agricultural Economics, International Association of Agricultural Economists, vol. 44(1), pages 93-109, January.
    5. Rachel McCulloch, 2010. "The International Trading System and Its Future," Working Papers 08, Brandeis University, Department of Economics and International Businesss School.
    6. Koopmann, Georg & Vogel, Lars, 2011. "Globalisierung, Regionalisierung und die Handelspolitik der Europäischen Union," HWWI Policy Papers 58, Hamburg Institute of International Economics (HWWI).
    7. Adlung, Rudolf & Molinuevo, Martin, 2008. "Bilateralism in services trade: is there fire behind the (BIT-)smoke?," WTO Staff Working Papers ERSD-2008-01, World Trade Organization (WTO), Economic Research and Statistics Division.
    8. Herz Bernhard & Wagner Marco, 2011. "Regionalism as a Building Block for Multilateralism," Global Economy Journal, De Gruyter, vol. 11(1), pages 1-25, March.
    9. Tristan Kohl, 2014. "Do we really know that trade agreements increase trade?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(3), pages 443-469, August.
    10. Patrick Georges, 2009. "Dispensing with NAFTA Rules of Origin? Some Policy Options for Canada," Working Papers 0904E, University of Ottawa, Department of Economics.
    11. Guanyi Leu, 2011. "ASEAN’s Preferential Trade Agreements (PTA) Strategy," Journal of Current Southeast Asian Affairs, Institute of Asian Studies, GIGA German Institute of Global and Area Studies, Hamburg, vol. 30(2), pages 31-64.
    12. Bernhard Herz & Marco Wagner, 2010. "Multilateralism versus Regionalism!?," DEGIT Conference Papers c015_043, DEGIT, Dynamics, Economic Growth, and International Trade.
    13. Richard Pomfret, 2009. "Regionalism in the Asia-Pacific Region: How Wide, How Deep?," School of Economics Working Papers 2009-31, University of Adelaide, School of Economics.
    14. Carlo Piccardi & Lucia Tajoli, 2015. "Are Preferential Agreements Significant for the World Trade Structure? A Network Community Analysis," Kyklos, Wiley Blackwell, vol. 68(2), pages 220-239, May.

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