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Preferential Trade Agreements and the Margins of Imports

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  • Neil Foster

Abstract

This paper considers the importance of Preferential Trade Agreements (PTAs) in enhancing trade for a large sample of countries within the period 1962–2000. The paper builds upon the existing literature by examining whether any significant effects of PTAs occur through a change in the variety of imports (i.e. the extensive margin) or through a change in the volume of existing products (the intensive margin). Our results indicate that imports respond positively to the formation of a PTA between countries, and that much of this increase in imports occurs along the extensive margin. Copyright Springer Science+Business Media, LLC 2012

Suggested Citation

  • Neil Foster, 2012. "Preferential Trade Agreements and the Margins of Imports," Open Economies Review, Springer, vol. 23(5), pages 869-889, November.
    • Handle: RePEc:kap:openec:v:23:y:2012:i:5:p:869-889
    DOI: 10.1007/s11079-011-9213-5
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    Cited by:

    1. Sang‐Wook (Stanley) Cho & Hansoo Choi & Julián P. Díaz, 2022. "The causal effect of free trade agreements on the trade margins: Product‐level evidence from geographically distant partners," Southern Economic Journal, John Wiley & Sons, vol. 88(4), pages 1453-1489, April.
    2. KUNO Arata & URATA Shujiro & YOKOTA Kazuhiko, 2016. "Estimating the Impacts of FTA on Foreign Trade: An analysis of extensive and intensive trade margins for the Japan-Mexico FTA," Discussion papers 16003, Research Institute of Economy, Trade and Industry (RIETI).
    3. KUNO Arata & URATA Shujiro & YOKOTA Kazuhiko, 2017. "FTAs and the Pattern of Trade: The case of the Japan-Chile FTA," Discussion papers 17091, Research Institute of Economy, Trade and Industry (RIETI).
    4. Sang-wook (Stanley) Cho & Hansoo Choi & Julián P. Díaz, 2018. "Do Free Trade Agreements Increase the New Goods Margin? Evidence from Korea," Open Economies Review, Springer, vol. 29(5), pages 1095-1122, November.
    5. Said, Rashidi & Ismail, Normaz Wana, 2018. "The Impacts of Malaysian Free Trade Agreements on Margins of Trade," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 52(1), pages 169-178.
    6. John T. Dalton, 2017. "EU Enlargement and the New Goods Margin in Austrian Trade," Open Economies Review, Springer, vol. 28(1), pages 61-78, February.
    7. My Duong & Mark J. Holmes & Anna Strutt & Steven Lim, 2019. "Effects of Trade Agreements and Foreign Direct Investment on Trade: Evidence from Vietnam," International Journal of Economics and Financial Issues, Econjournals, vol. 9(3), pages 116-126.

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    More about this item

    Keywords

    Preferential trade agreements; Intensive and extensive margin; Gravity model; F10; F15;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F15 - International Economics - - Trade - - - Economic Integration

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