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Trade Creation and Diversion Effects of Europe's Regional Liberalization Agreements

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  • Yener Kandogan

Abstract

After a short review of recent developments in gravity modeling and an overview of the liberalization agreements in Europe, this paper measures the trade creation and diversion effects of major European agreements based on the results of a correctly specified triple-indexed gravity model with bilateral fixed effects. Discussion of the resulting trade creation and diversion focuses on the role of partner and non-partner country characteristics including size and relative factor endowments, as well as date, reciprocity, industry coverage, and rate of liberalization characteristics of the agreement.

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  • Yener Kandogan, 2009. "Trade Creation and Diversion Effects of Europe's Regional Liberalization Agreements," International Economic Journal, Taylor & Francis Journals, vol. 23(4), pages 591-615.
    • Handle: RePEc:taf:intecj:v:23:y:2009:i:4:p:591-615
    DOI: 10.1080/10168730903372257
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    References listed on IDEAS

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    2. Bianka Dettmer, 2012. "The European Union's service directive: Contrasting ex ante estimates with empirical evidence," Jena Economics Research Papers 2012-019, Friedrich-Schiller-University Jena.

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    Keywords

    Gravity model; fixed effects;

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