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Gravity, Bilateral Agreements, and Trade Diversion in the Americas

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Listed:
  • Raymond Robertson
  • Antoni Estevadeordal.

Abstract

Krishna (1998) shows that a bilateral agreement between two countries render a multilateral agreement less attractive if the bilateral agreement is trade diverting. This paper combines Krishna’s model with the empirical approach of Anderson and va

Suggested Citation

  • Raymond Robertson & Antoni Estevadeordal., 2009. "Gravity, Bilateral Agreements, and Trade Diversion in the Americas," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 46(133), pages 3-33.
  • Handle: RePEc:ioe:cuadec:v:46:y:2009:i:133:p:3-33
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    File URL: http://www.economia.uc.cl/docs/133robea.pdf
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    References listed on IDEAS

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    1. Antoni Estevadeordal & Caroline Freund & Emanuel Ornelas, 2008. "Does Regionalism Affect Trade Liberalization Toward Nonmembers?," The Quarterly Journal of Economics, Oxford University Press, vol. 123(4), pages 1531-1575.
    2. Drusilla K. Brown & Alan V. Deardorff & Robert M. Stern, 2003. "Multilateral, Regional and Bilateral Trade-Policy Options for the United States and Japan," The World Economy, Wiley Blackwell, vol. 26(6), pages 803-828, June.
    3. Wilfred J. Ethier, 1998. "Regionalism in a Multilateral World," Journal of Political Economy, University of Chicago Press, vol. 106(6), pages 1214-1245, December.
    4. James E. Anderson & Eric van Wincoop, 2003. "Gravity with Gravitas: A Solution to the Border Puzzle," American Economic Review, American Economic Association, pages 170-192.
    5. Gordon H. Hanson & Chong Xiang, 2004. "The Home-Market Effect and Bilateral Trade Patterns," American Economic Review, American Economic Association, pages 1108-1129.
    6. Andrew K. Rose, 2004. "Do We Really Know That the WTO Increases Trade?," American Economic Review, American Economic Association, pages 98-114.
    7. Gordon H. Hanson & Chong Xiang, 2004. "The Home-Market Effect and Bilateral Trade Patterns," American Economic Review, American Economic Association, pages 1108-1129.
    8. Simon J. Evenett & Wolfgang Keller, 2002. "On Theories Explaining the Success of the Gravity Equation," Journal of Political Economy, University of Chicago Press, vol. 110(2), pages 281-316, April.
    9. Ethier, Wilfred J, 1998. "The New Regionalism," Economic Journal, Royal Economic Society, vol. 108(449), pages 1149-1161, July.
    10. James E. Anderson & Eric van Wincoop, 2003. "Gravity with Gravitas: A Solution to the Border Puzzle," American Economic Review, American Economic Association, pages 170-192.
    11. Anderson, James E, 1979. "A Theoretical Foundation for the Gravity Equation," American Economic Review, American Economic Association, pages 106-116.
    12. Limao, Nuno & Venables, Anthony J., 1999. "Infrastructure, geographical disadvantage, and transport costs," Policy Research Working Paper Series 2257, The World Bank.
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    Citations

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    Cited by:

    1. Vu Thanh Hai & Albert K. Tsui & Zhaoyong Zhang, 2013. "Measuring asymmetry and persistence in conditional volatility in real output: evidence from three East Asian tigers using a multivariate GARCH approach," Applied Economics, Taylor & Francis Journals, vol. 45(20), pages 2909-2914, July.
    2. Andrew T. Young & Hernando Zuleta, 2016. "Golden Rules of Wages," Southern Economic Journal, Southern Economic Association, vol. 83(1), pages 253-270, July.
    3. Pablo Guerrero & Krista Lucenti & Sebastián Galarza S., 2009. "Trade Logistic and Regional Integration in Latin America & the Caribbean," IDB Publications (Working Papers) 9331, Inter-American Development Bank.
    4. Prema-chandra Athukorala & Archanun Kohpaiboon, 2009. "Intra-Regional Trade in East Asia: The Decoupling Fallacy, Crisis, and Policy Challenges," Departmental Working Papers 2009-09, The Australian National University, Arndt-Corden Department of Economics.

    More about this item

    Keywords

    Gravity models; asymmetric tariffs; trade diversion;

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration

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