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Trade Creation and Diversion in the Enlarged EU Market: Evidence for Agricultural Trade in Slovakia

  • Dusan Drabik

    ()

    (Slovak Agricultural University in Nitra, Slovakia)

  • Jan Pokrivcak

    ()

    (Slovak Agricultural University in Nitra, Slovakia)

  • Pavel Ciaian

    ()

    (Katholieke Universiteit Leuven, Belgium, and Slovak Agricultural University in Nitra)

In the paper the authors analyze the changes in agricultural trade patterns in Slovakia influenced by the gradual trade liberalization that occurred prior to European Union enlargement in 2004. The results show a significant trade-diversion effect of the enlargement on Slovak agricultural trade. A one-percentage-point reduction in the agricultural tariff rate of Slovakia increases agricultural imports from EU15 and Central and East European countries (CEEC) by around 3 percent. Given that the average reduction in tariff rates was 10.4 percent, the authors can conclude that approximately 31.4 percent of the increase in agricultural imports from the EU15 and CEEC was due to elimination of tariffs as Slovakia (and the other CEECs) joined the EU.

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Article provided by Charles University Prague, Faculty of Social Sciences in its journal Finance a uver - Czech Journal of Economics and Finance.

Volume (Year): 57 (2007)
Issue (Month): 9-10 (October)
Pages: 433-447

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Handle: RePEc:fau:fauart:v:57:y:2007:i:9-10:p:433-447
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  1. Soloaga, Isidro & Alan Wintersb, L., 2001. "Regionalism in the nineties: what effect on trade?," The North American Journal of Economics and Finance, Elsevier, vol. 12(1), pages 1-29, March.
  2. Anne O. Krueger, 1999. "Trade Creation and Trade Diversion Under NAFTA," NBER Working Papers 7429, National Bureau of Economic Research, Inc.
  3. Ciaian, Pavel & Swinnen, Johan F.M., 2007. "Distortions to Agricultural Incentives in Central and Eastern Europe," Agricultural Distortions Working Paper 48385, World Bank.
  4. Peter Egger & Michael Pfaffernmayr, 2002. "The Pure Effects of European Integration on Intra-EU Core and Periphery Trade," International Trade 0204001, EconWPA.
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