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Welfare and Integration


  • Kowalczyk, Carsten


This article argues that the terms-of-trade and volume-of-trade taxonomy from the theory of tariffs constitutes an attractive alternative to Viner's trade diversion and creation effects for the analysis of preferential trading arrangements. In applications of the alternative approach, the article establishes that results by Lipsey and Riezman on large versus small preunion trade flows for choice of partners are not "contradictory" and that under some conditions a small country's optimal strategy is to seek membership of multiple free-trade areas. Copyright 2000 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.

Suggested Citation

  • Kowalczyk, Carsten, 2000. "Welfare and Integration," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 41(2), pages 483-494, May.
  • Handle: RePEc:ier:iecrev:v:41:y:2000:i:2:p:483-94

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    References listed on IDEAS

    1. Peter Kooreman & Arie Kapteyn, 1990. "On the Empirical Implementation of Some Game Theoretic Models of Household Labor Supply," Journal of Human Resources, University of Wisconsin Press, vol. 25(4), pages 584-598.
    2. Pedro Hernandez & Andrea Beller & John Graham, 1995. "Changes in the Relationship Between Child Support Payments and Educational Attainment of Offspring, 1979–1988," Demography, Springer;Population Association of America (PAA), vol. 32(2), pages 249-260, May.
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    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Carsten Kowalczyk & Raymond Riezman, 2009. "Trade Agreements," CESifo Working Paper Series 2660, CESifo Group Munich.
    2. Furusawa, Taiji & Konishi, Hideo, 2004. "A welfare decomposition in quasi-linear economies," Economics Letters, Elsevier, vol. 85(1), pages 29-34, October.
    3. Juyoung Cheong & Do Won Kwak & Kam Ki Tang, 2015. "Can Trade Agreements Curtail Trade Creation and Prevent Trade Diversion?," Review of International Economics, Wiley Blackwell, vol. 23(2), pages 221-238, May.
    4. Lisandro Abrego & Raymond Riezman & John Whalley, 2013. "How often are propositions on the effects of regional trade agreements theoretical curiosa?," World Scientific Book Chapters,in: International Trade Agreements and Political Economy, chapter 9, pages 129-148 World Scientific Publishing Co. Pte. Ltd..
    5. Hideo Konishi & Carsten Kowalczyk & Tomas Sjostrom, 2003. "Free Trade, Customs Unions, and Transfers," Boston College Working Papers in Economics 568, Boston College Department of Economics.
    6. Burfisher, Mary E. & Robinson, Sherman & Thierfelder, Karen, 2004. "Regionalism," MTID discussion papers 65, International Food Policy Research Institute (IFPRI).
    7. Isabelle Schluep Campo & Robert Jörin, 2009. "Liberalizing the Swiss Meat Market with the EU: Welfare Effects and Impacts on Third Countries," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 145(I), pages 107-126, March.
    8. Juyoung Cheong & Do Won Kwak & Kam Ki Tang, 2015. "It Is Much Bigger Than What We Thought: New Estimate of Trade Diversion," The World Economy, Wiley Blackwell, vol. 38(11), pages 1795-1808, November.
    9. Halis Murat Yildiz, 2014. "Hub and spoke trade agreements under oligopoly with asymmetric costs," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 23(1), pages 97-110, February.

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