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Does Regional Integration Promote the Multilateralization of Trade Flows?: a Gravity Model Using Panel Data

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  • Trotignon, Jérôme

    () (University of Lyon)

Abstract

We will be asking ourselves whether the trading blocs created or renewed since the end of the 1980s favor the multilateralization of trade, and so constitute building or stumbling blocks with regard to trade flows. In a gravity model using panel data, we estimate a set of three regional dummies representative of intrabloc trade, extra-bloc exports and extra-bloc imports. Taking the resulting three coefficients as a starting point, we propose an original typology of trade creations / diversions and of trading blocs. By applying this to our results, all the groups chosen as well as the Economic and Monetary Union, are shown to be building blocks. No trade diversion is noted, apart from an export diversion brought about by the North American Free Trade Agreement.

Suggested Citation

  • Trotignon, Jérôme, 2010. "Does Regional Integration Promote the Multilateralization of Trade Flows?: a Gravity Model Using Panel Data," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 25, pages 223-251.
  • Handle: RePEc:ris:integr:0503
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    References listed on IDEAS

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    Cited by:

    1. Pakasa Bary, 2015. "The Time-Varying Impact of Regional Trade Agreement: Evidence from ASEAN," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 5(9), pages 1061-1075, September.

    More about this item

    Keywords

    Trade Integration; Gravity Model; Trade Creation/Diversion; Building/Stumbling Blocks;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration

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