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A Re-Examination of the Effect of GATT/WTO on Trade

Author

Listed:
  • Salvador Gil-Pareja

    (University of Valencia)

  • Rafael Llorca-Vivero

    (University of Valencia)

  • José Antonio Martínez-Serrano

    (University of Valencia)

Abstract

The empirical literature on the effect of the GATT/WTO on trade provides ambiguous results. This paper sheds new light on this issue by re-examining the ex post (partial) effect of GATT/WTO membership on trade using multiple econometric specifications of the gravity equation and analysing several potential asymmetries of the GATT/WTO system. Our results show an uneven but pervasive evidence that membership in GATT/WTO have had an economically significant effect on members’ bilateral trade. Moreover, we find that the GATT/WTO effect operates through both trade margins but mainly through the intensive margin.

Suggested Citation

  • Salvador Gil-Pareja & Rafael Llorca-Vivero & José Antonio Martínez-Serrano, 2016. "A Re-Examination of the Effect of GATT/WTO on Trade," Open Economies Review, Springer, vol. 27(3), pages 561-584, July.
    • Handle: RePEc:kap:openec:v:27:y:2016:i:3:d:10.1007_s11079-015-9385-5
    DOI: 10.1007/s11079-015-9385-5
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    Cited by:

    1. Silviano Esteve-Pérez & Salvador Gil-Pareja & Rafael Llorca-Vivero, 2020. "Does the GATT/WTO promote trade? After all, Rose was right," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 156(2), pages 377-405, May.
    2. Díaz-Mora, Carmen & Esteve-Pérez, Silviano & Gil-Pareja, Salvador, 2023. "A re-assessment of the heterogeneous effect of trade agreements using intra-national trade flows," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 940-951.
    3. Carmen Díaz-Mora & Silviano Esteve-Pérez & Salvador Gil-Pareja & Fernando Ríos-Avila, 2024. "The EMU effect on trade: A re-assessment accounting for staggered treatment adoption," Working Papers 2407, Department of Applied Economics II, Universidad de Valencia.
    4. Silviano Esteve-Pérez & Salvador Gil-Pareja & Rafael Llorca-Vivero & Jordi Paniagua, 2021. "Has the Euro paid off? A study of the trade-induced welfare effects of the EMU," Working Papers 2103, Department of Applied Economics II, Universidad de Valencia.
    5. Samuel Admassu, 2020. "The trade creation effects of Africa’s reciprocal vis-à-vis non-reciprocal trade agreements," Empirical Economics, Springer, vol. 59(6), pages 2717-2730, December.
    6. Teresa L. Cyrus, 2021. "Why Do Countries Form Regional Trade Agreements? A Discrete-Time Survival Analysis," Open Economies Review, Springer, vol. 32(2), pages 417-434, April.
    7. Salvador Gil-Pareja & Rafael Llorca-Vivero & José Antonio Martínez-Serrano, 2018. "Reciprocal vs nonreciprocal trade agreements: which have been best to promote exports?," Working Papers 1802, Department of Applied Economics II, Universidad de Valencia.
    8. Jason Query, 2024. "Gross Product, Population Distribution and Heterogeneity of Border Effects in Gravity Models of Trade," Open Economies Review, Springer, vol. 35(3), pages 605-621, July.

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    More about this item

    Keywords

    GATT; WTO; Trade; Gravity model; Extensive margin; Intensive margin;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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