Trade creation and trade diversion in West African Monetary Zone (WAMZ)
This paper estimates the trade effects of WAMZ between 2005 and 2010 using the gravity model. In addition, it also estimates the determinants of bilateral trade flows in WAMZ countries. The paper finds that WAMZ has been trade diverting although country specific analysis reveals that individual countries in the RTA do not necessarily exhibit similar trends as Nigeria and Gambia are export creating while Ghana and Guinea are export diverting. It also finds that economic size, geographical factors and political stability are significant determinants of WAMZ's bilateral trade. Therefore, regional policies in WAMZ should be more directed towards promoting initiatives that will enhance extra and intra-WAMZ trade by the appropriate authorities.
Volume (Year): 32 (2012)
Issue (Month): 4 ()
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- Xavier Debrun & Paul Masson & Catherine Pattillo, 2005. "Monetary union in West Africa: who might gain, who might lose, and why?," Canadian Journal of Economics, Canadian Economics Association, vol. 38(2), pages 454-481, May.
- Rashad Cassim, 2001. "The Determinants of Intra-Regional Trade in Southern Africa with Specific Reference to South Africa and the Rest of the Region," Working Papers 01051, University of Cape Town, Development Policy Research Unit.
- Magee, Christopher S.P., 2008. "New measures of trade creation and trade diversion," Journal of International Economics, Elsevier, vol. 75(2), pages 349-362, July.
- Jugurnath, Bhavish & Stewart, Mark & Brooks, Robert, 2007. "Asia/Pacific Regional Trade Agreements: An empirical study," Journal of Asian Economics, Elsevier, vol. 18(6), pages 974-987, December.
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- Ghosh, Sucharita & Yamarik, Steven, 2004. "Are regional trading arrangements trade creating?: An application of extreme bounds analysis," Journal of International Economics, Elsevier, vol. 63(2), pages 369-395, July.
- Longo, Robert & Sekkat, Khalid, 2004.
"Economic Obstacles to Expanding Intra-African Trade,"
Elsevier, vol. 32(8), pages 1309-1321, August.
- Roberto Longo & Khalid Sekkat, 2004. "Economic obstacles to expanding intra-African trade," ULB Institutional Repository 2013/7358, ULB -- Universite Libre de Bruxelles.
- Carrere, Celine, 2006. "Revisiting the effects of regional trade agreements on trade flows with proper specification of the gravity model," European Economic Review, Elsevier, vol. 50(2), pages 223-247, February.
- Martínez-Zarzoso, Inmaculada & Felicitas, Nowak-Lehmann D. & Horsewood, Nicholas, 2009. "Are regional trading agreements beneficial?: Static and dynamic panel gravity models," The North American Journal of Economics and Finance, Elsevier, vol. 20(1), pages 46-65, March.
- Athukorala, Prema-chandra, 2012. "Asian trade flows: Trends, patterns and prospects," Japan and the World Economy, Elsevier, vol. 24(2), pages 150-162. Full references (including those not matched with items on IDEAS)
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