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Externalities and Free Trade Agreements

Author

Listed:
  • Grafe, F.
  • Mauleon, A.

Abstract

This paper studies the consequences of a private or depletable externality on free trade agreements in a general equiilibrium framework. It is shown that there always exists a stable system of free trade spaces in the world economy. This stable system can result in either non-cooperation, partial cooperation, or total cooperation among countries of different types.

Suggested Citation

  • Grafe, F. & Mauleon, A., 1997. "Externalities and Free Trade Agreements," ASSET - Instituto De Economia Publica 172, ASSET (Association of Southern European Economic Theorists).
    • Handle: RePEc:fth:inecpu:172
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    Cited by:

    1. Ana Mauleon & Huasheng Song & Vincent Vannetelbosch, 2010. "Networks of Free Trade Agreements among Heterogeneous Countries," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 12(3), pages 471-500, June.

    More about this item

    Keywords

    EXTERNALITIES ; FREE TRADE ; GENERAL EQUILIBRIUM;
    All these keywords.

    JEL classification:

    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium

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