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Reassessing the Impact of the Single Market and Its Ability to Help Build Strategic Autonomy

Author

Listed:
  • Lionel Fontagné
  • Yoto V. Yotov
  • Lionel Gérard Fontagné

Abstract

European integration, which culminated in the completion of the Single Market, the single currency and successive enlargements, is now faced with the question of strategic autonomy. Against this backdrop, the present paper has three objectives. First, it assesses the benefits of EU membership based on new, disaggregated trade and production data and using established and cutting-edge empirical methods. Second, it evaluates the costs of strategic autonomy – implying not trading with “riskier” partners. Third, it asks whether further deepening of the Single Market can alleviate these costs. The paper shows that the gains from European integration are substantial, albeit heterogeneous across Member States and sectors, and that the cost of strategic autonomy can be offset by deeper, but comparatively more modest, integration efforts within the European Single Market.

Suggested Citation

  • Lionel Fontagné & Yoto V. Yotov & Lionel Gérard Fontagné, 2024. "Reassessing the Impact of the Single Market and Its Ability to Help Build Strategic Autonomy," CESifo Working Paper Series 11151, CESifo.
    • Handle: RePEc:ces:ceswps:_11151
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    References listed on IDEAS

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    1. Mario Larch & José-Antonio Monteiro & Roberta Piermartini & Yoto V. Yotov, 2019. "On the Effects of GATT/WTO Membership on Trade: They Are Positive and Large after All," CESifo Working Paper Series 7721, CESifo.
    2. Egger, Peter H. & Tarlea, Filip, 2015. "Multi-way clustering estimation of standard errors in gravity models," Economics Letters, Elsevier, vol. 134(C), pages 144-147.
    3. Richard Baldwin & Daria Taglioni, 2006. "Gravity for Dummies and Dummies for Gravity Equations," NBER Working Papers 12516, National Bureau of Economic Research, Inc.
    4. repec:spo:wpmain:info:hdl:2441/6apm7lruv088iagm4rv2c33jtg is not listed on IDEAS
    5. Antoine Berthou & Lionel Fontagné, 2013. "How do Multiproduct Exporters React to a Change in Trade Costs?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 115(2), pages 326-353, April.
    6. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, December.
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    Citations

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    Cited by:

    1. Harald Oberhofer & Zhenyi Wang, 2025. "Everything You Always Wanted to Know About EU Membership Trade Effects But Were Afraid to Ask," CESifo Working Paper Series 11823, CESifo.
    2. Stefani Stefanova & Sophie Bandarkar & Yoto Yotov, 2025. "A Reassessment of the Impact of the Organization for Economic Co-operation and Development on International Trade," Working Papers 202509, Center for Global Policy Analysis, LeBow College of Business, Drexel University.
    3. Felbermayr, Gabriel & Hinz, Julian & Krantz, Sebastian & Mahlkow, Hendrik & Wanner, Joschka, 2025. "Tariffs hit differently: The regional impact of US tariffs across Europe and the role of the single market," Kiel Working Papers 2309, Kiel Institute for the World Economy.
    4. Lionel Fontagné & Yoto V Yotov, 2025. "The Low-Hanging Fruit of the Single European Market: New Methods and Measures," Working Papers hal-05048951, HAL.
    5. Florencia Airaudo & Francois de Soyres & Alexandre Gaillard & Ana Maria Santacreu, 2025. "Recent Evolutions in the Global Trade System: From Integration to Strategic Realignment," Working Papers 2025-027, Federal Reserve Bank of St. Louis.
    6. Arne J. Nagengast & Fernando Rios‐Avila & Yoto V. Yotov, 2026. "The European single market and intra‐EU trade: an assessment with heterogeneity‐robust difference‐in‐differences methods," Economica, London School of Economics and Political Science, vol. 93(369), pages 298-331, January.
    7. Philip McCann & Raquel Ortega-Argilés & Mark Thissen & Ming-Wei Hsu, 2026. "Mercantilist and protectionist shocks on innovation, growth, and economic policy in European regions," Journal of Evolutionary Economics, Springer, vol. 36(1), pages 1-27, April.
    8. Yoto V. Yotov, 2024. "The evolution of structural gravity: The workhorse model of trade," Contemporary Economic Policy, Western Economic Association International, vol. 42(4), pages 578-603, October.
    9. Lionel Fontagne & Krasimir Shishmanov & Penka Shishmanova & Yoto Yotov, 2025. "Asymmetric Impacts of Economic Integration: The Case of the Single European Market," Working Papers 202533, Center for Global Policy Analysis, LeBow College of Business, Drexel University.

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    Keywords

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    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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