Small State Regional Cooperation, South-South and South-North Migration, and International Trade
This paper provides a different basis than previous analyses for regional bloc formation and regional migration. Due to low bargaining power and fixed costs, small states face a severe disadvantage in negotiations with the rest of the world and might benefit by forming a regional bloc. The study a) presents a general equilibrium model where bargaining power, international (IC) and regional (RC) negotiation costs, number of issues negotiated (N), and accession rule to the bloc determine its size and welfare impact, and b) examines the impact of international migration as well as the migration-trade relationship. The main findings are: i) the likelihood of regional bloc formation, its size and welfare impact increases with IC, N and decreases with RC; ii) bloc size is optimal (below the optimum) if an accession fee is (is not) charged; iii) South-South migration raises bloc size and welfare; iv) South-South migration and trade are complements under market access negotiations and are substitutes under negotiations for unilateral transfers as well as under migrant remittances; and vi) South-North migration and bloc formation, and South-North and South-South migration, are substitutes for the states that benefit from membership in the bloc.
|Date of creation:||May 2010|
|Date of revision:|
|Publication status:||published as 'Small States, Micro States, and their International Negotiation and Migration' in: Journal of Economic Integration, 2014, 29 (3), 430-449|
|Contact details of provider:|| Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany|
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
|Order Information:|| Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Ramón López & Maurice Schiff, 1998. "Migration and the Skill composition of the Labor Force: The Impact of Trade Liberalization in LDCs," Canadian Journal of Economics, Canadian Economics Association, vol. 31(2), pages 318-336, May.
- James E. Rauch & Vitor Trindade, 1999.
"Ethnic Chinese Networks in International Trade,"
NBER Working Papers
7189, National Bureau of Economic Research, Inc.
- Artjoms Ivlevs & Jaime De Melo, 2010.
"FDI, the Brain Drain and Trade: Channels and Evidence,"
Annals of Economics and Statistics,
GENES, issue 97-98, pages 103-121.
- Artjoms IVLEVS & Jaime DE MELO, 2015. "FDI, the Brain Drain and Trade: Channels and Evidence," World Scientific Book Chapters, in: Developing Countries in the World Economy, chapter 21, pages 533-551 World Scientific Publishing Co. Pte. Ltd..
- Artjoms Ivlevs & Jaime de Melo, . "FDI, the Brain Drain and Trade: Channels and Evidence," Discussion Papers 08/40, University of Nottingham, GEP.
- de Melo, Jaime & Ivlevs, Artjoms, 2008. "FDI, the Brain Drain and Trade: Channels and Evidence," CEPR Discussion Papers 7002, C.E.P.R. Discussion Papers.
- Artjoms Ivlevs & Jaime de Melo, 2008. "FDI, the Brain Drain and Trade: Channels and Evidence," Development Working Papers 261, Centro Studi Luca d'Agliano, University of Milano.
- Javorcik, Beata S. & Özden, Çaglar & Spatareanu, Mariana & Neagu, Cristina, 2011.
"Migrant networks and foreign direct investment,"
Journal of Development Economics,
Elsevier, vol. 94(2), pages 231-241, March.
- Javorcik, Beata S. & Ozden, Caglar & Spatareanu, Mariana & Neagu, Cristina, 2006. "Migrant networks and foreign direct investment," Policy Research Working Paper Series 4046, The World Bank.
- Beata S. Javorcik & Çaglar Özden & Mariana Spatareanu & Cristina Neagu, 2006. "Migrant Networks and Foreign Direct Investment," Working Papers Rutgers University, Newark 2006-003, Department of Economics, Rutgers University, Newark.
- Richard Baldwin, 1993.
"A Domino Theory of Regionalism,"
NBER Working Papers
4465, National Bureau of Economic Research, Inc.
- Kugler, Maurice & Rapoport, Hillel, 2007. "International labor and capital flows: Complements or substitutes?," Economics Letters, Elsevier, vol. 94(2), pages 155-162, February.
- Andriamananjara, Soamiely & Schiff, Maurice, 1998. "Regional groupings among microstates," Policy Research Working Paper Series 1922, The World Bank.
- Markusen, James R., 1983. "Factor movements and commodity trade as complements," Journal of International Economics, Elsevier, vol. 14(3-4), pages 341-356, May.
When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp4938. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak)
If references are entirely missing, you can add them using this form.