IDEAS home Printed from https://ideas.repec.org/p/aee/wpaper/0510.html
   My bibliography  Save this paper

Determinants of regional integration agreements in a discrete choice framework: re-examining the evidence

Author

Listed:
  • Laura Márquez-Ramos

    (Departamento de Economía and Instituto de Economía Internacional, Universitat Jaume I)

  • Inmaculada Martínez-Zarzoso

    (Departamento de Economía and Instituto de Economía Internacional, Universitat Jaume I)

  • Celestino Suárez-Burguet

    (Departamento de Economía and Instituto de Economía Internacional, Universitat Jaume I)

Abstract

This paper provides new empirical evidence on the determinants of regional integration agreements (RIAs) in a discrete choice modelling framework. The research has two main aims: first, to empirically analyse the determinants of different levels of integration, re-examining the evidence presented by Baier and Bergstrand (2004) in the JIE 64 (1); and second, to analyse the importance of additional factors, in particular socio-political factors. The results show that geographical factors alone are the most important explanatory factors for the probability of regional integration agreement formation or enhancement, thus supporting the theories on "natural" trading partners. The socio-political factors considered, democracy dummy, the level of economic freedom and the common language dummy are all statistically significant, although their relative importance in explaining RIA formation is low.

Suggested Citation

  • Laura Márquez-Ramos & Inmaculada Martínez-Zarzoso & Celestino Suárez-Burguet, 2005. "Determinants of regional integration agreements in a discrete choice framework: re-examining the evidence," Working Papers 05-10, Asociación Española de Economía y Finanzas Internacionales.
    • Handle: RePEc:aee:wpaper:0510
    as

    Download full text from publisher

    File URL: http://www.aeefi.com/RePEc/pdf/defi05-10.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Jeffrey A. Frankel, 1998. "The Regionalization of the World Economy," NBER Books, National Bureau of Economic Research, Inc, number fran98-1, March.
    2. Frankel, Jeffrey A & Stein, Ernesto & Wei, Shang-Jin, 1996. "Regional Trading Arrangements: Natural or Supernatural," American Economic Review, American Economic Association, vol. 86(2), pages 52-56, May.
    3. Baier, Scott L. & Bergstrand, Jeffrey H., 2004. "Economic determinants of free trade agreements," Journal of International Economics, Elsevier, vol. 64(1), pages 29-63, October.
    4. Takeshi Amemiya, 1975. "Qualitative Response Models," NBER Chapters, in: Annals of Economic and Social Measurement, Volume 4, number 3, pages 363-372, National Bureau of Economic Research, Inc.
    5. Koppelman, Frank S. & Wen, Chieh-Hua, 1998. "Alternative nested logit models: structure, properties and estimation," Transportation Research Part B: Methodological, Elsevier, vol. 32(5), pages 289-298, June.
    6. Pédussel Wu, Jennifer, 2004. "Measuring and explaining levels of regional economic integration," ZEI Working Papers B 12-2004, University of Bonn, ZEI - Center for European Integration Studies.
    7. Frankel, Jeffrey & Stein, Ernesto & Wei, Shang-jin, 1995. "Trading blocs and the Americas: The natural, the unnatural, and the super-natural," Journal of Development Economics, Elsevier, vol. 47(1), pages 61-95, June.
    8. Jeffrey A. Frankel & Ernesto Stein & Shang-Jin Wei, 1998. "Continental Trading Blocs: Are They Natural or Supernatural?," NBER Chapters, in: The Regionalization of the World Economy, pages 91-120, National Bureau of Economic Research, Inc.
    9. Magee Christopher S, 2003. "Endogenous Preferential Trade Agreements: An Empirical Analysis," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 2(1), pages 1-19, December.
    10. Baier, Scott L. & Bergstrand, Jeffrey H., 2007. "Do free trade agreements actually increase members' international trade?," Journal of International Economics, Elsevier, vol. 71(1), pages 72-95, March.
    11. Daniel McFadden & Kenneth Train, 2000. "Mixed MNL models for discrete response," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 15(5), pages 447-470.
    12. Frankel, Jeffrey A. & Stein, Ernesto & Wei, Shang-Jin, 1996. "Regional Trading Arrangements," Center for International and Development Economics Research, Working Paper Series qt5hf1z4rv, Center for International and Development Economics Research, Institute for Business and Economic Research, UC Berkeley.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Laura Márquez-Ramos & Inmaculada Martínez-Zarzoso & Celestino Suárez-Burguet, 2011. "Determinants of Deep Integration: Examining Socio-political Factors," Open Economies Review, Springer, vol. 22(3), pages 479-500, July.
    2. Chen, Maggie X., 2009. "Regional economic integration and geographic concentration of multinational firms," European Economic Review, Elsevier, vol. 53(3), pages 355-375, April.
    3. Baier, Scott L. & Bergstrand, Jeffrey H., 2007. "Do free trade agreements actually increase members' international trade?," Journal of International Economics, Elsevier, vol. 71(1), pages 72-95, March.
    4. Salvador Gil-Pareja & Rafael Llorca & Josè A. Martinez-Serrano, 2011. "Is There A Continental Bias In Trade?," ERSA conference papers ersa10p792, European Regional Science Association.
    5. Salvador Gil-Pareja & Rafael Llorca-Vivero & José Martínez-Serrano, 2015. "The Uneven Impact of Continental Boundaries on Trade," Open Economies Review, Springer, vol. 26(2), pages 237-257, April.
    6. 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.
    7. Mr. Kangni R Kpodar & Patrick A. Imam, 2015. "Does A Regional Trade Agreement Lessen or Exacerbate Growth Volatility? An Empirical Investigation," IMF Working Papers 2015/177, International Monetary Fund.
    8. Kangni Kpodar & Patrick Imam, 2016. "Does a Regional Trade Agreement Lessen or Worsen Growth Volatility? An Empirical Investigation," Review of International Economics, Wiley Blackwell, vol. 24(5), pages 949-979, November.
    9. Neil Foster & Robert Stehrer, 2011. "Preferential trade agreements and the structure of international trade," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 147(3), pages 385-409, September.
    10. Alberto Behar & Laia Cirera-i-Crivillé, 2013. "Does it Matter Who You Sign With? Comparing the Impacts of North–South and South–South Trade Agreements on Bilateral Trade," Review of International Economics, Wiley Blackwell, vol. 21(4), pages 765-782, September.
    11. Guglielmo Caporale & Christophe Rault & Robert Sova & Anamaria Sova, 2009. "On the bilateral trade effects of free trade agreements between the EU-15 and the CEEC-4 countries," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 145(3), pages 573-573, October.
    12. Rod Falvey & Neil Foster-McGregor, 2022. "The breadth of preferential trade agreements and the margins of exports," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 158(1), pages 181-251, February.
    13. Egger, Hartmut & Egger, Peter & Greenaway, David, 2008. "The trade structure effects of endogenous regional trade agreements," Journal of International Economics, Elsevier, vol. 74(2), pages 278-298, March.
    14. Foster, Neil & Poeschl, Johannes & Stehrer, Robert, 2011. "The impact of Preferential Trade Agreements on the margins of international trade," Economic Systems, Elsevier, vol. 35(1), pages 84-97, March.
    15. Moser, Christoph & Rose, Andrew K., 2014. "Who benefits from regional trade agreements? The view from the stock market," European Economic Review, Elsevier, vol. 68(C), pages 31-47.
    16. Baier, Scott L. & Bergstrand, Jeffrey H., 2001. "The growth of world trade: tariffs, transport costs, and income similarity," Journal of International Economics, Elsevier, vol. 53(1), pages 1-27, February.
    17. Gabriel Felbermayr & Mario Larch & Finn Krüger & Lisandra Flach & Erdal Yalcin & Sebastian Benz, 2013. "Dimensionen und Auswirkungen eines Freihandelsabkommens zwischen der EU und den USA," ifo Forschungsberichte, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 62.
    18. Neil Foster, 2012. "Preferential Trade Agreements and the Margins of Imports," Open Economies Review, Springer, vol. 23(5), pages 869-889, November.
    19. Baier, Scott L. & Bergstrand, Jeffrey H., 2004. "Economic determinants of free trade agreements," Journal of International Economics, Elsevier, vol. 64(1), pages 29-63, October.

    More about this item

    Keywords

    Regional integration agreements; discrete choice models; trade flows; natural partners;
    All these keywords.

    JEL classification:

    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F15 - International Economics - - Trade - - - Economic Integration

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aee:wpaper:0510. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Luis Miguel del Corral Cuervo (email available below). General contact details of provider: https://edirc.repec.org/data/aeefiea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.