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The Role of Association Agreements within European Union Enlargement to Central and Eastern European Countries

Listed author(s):
  • Christophe Rault

    ()

    (LEO - Laboratoire d'économie d'Orleans - CNRS - UO - Université d'Orléans)

  • Ana Maria Sova
  • Robert Sova

The main goal of regionalization is the creation of free trade areas and the guarantee for countries to accede to a widened market. Many studies dealing with the effects of regional free trade agreements on trade flows already exist in the economic literature and the explosion in the number of regional agreements among countries has recently stressed the key role of regionalization. However, the effects of agreements on trade were sometimes contradictory in those studies. These diverging results can be explained by the potential endogeneity bias of the agreement variable. Our research in this paper aims at reassessing the genuine role of associations. For this matter, we particularly study the association of Central and Eastern European countries (CEEC) with European Union countries. Our econometric analysis based on qualitative choice models highlights in particular why European countries chose to conclude an association agreement with CEEC, and stresses the fact that European Union countries select endogenously the conclusion of association agreements. We are also particularly interested in modeling the effect of the association agreement on export performances between countries, and to quantify its impact. When considering annual data for 4 CEEC and 19 OECD countries (1990-2004), we find a 0.17 positive impact of the association agreement on bilateral exports.

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Paper provided by HAL in its series Post-Print with number halshs-00202790.

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Date of creation: 2008
Publication status: Published in The Swiss Review of International Economic Relations, 2008, pp.xx/xx
Handle: RePEc:hal:journl:halshs-00202790
Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00202790
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References listed on IDEAS
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  12. Aitken, Norman D, 1973. "The Effect of the EEC and EFTA on European Trade: A Temporal Cross-Section Analysis," American Economic Review, American Economic Association, vol. 63(5), pages 881-892, December.
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  24. Richard K. Abrams, 1980. "International trade flows under flexible exchange rates," Economic Review, Federal Reserve Bank of Kansas City, issue Mar, pages 3-10.
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