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Are Free Trade Agreements Contagious?

  • Richard Baldwin
  • Dany Jaimovich

This paper presents a new model of the domino effect which is used to generate an empirical index of how "contagious" FTAs are with respect to third nations. We test our contagion hypothesis together with alternative specifications of interdependence and other political, economical and geographical determinants of FTA formation. Our main finding is that contagion is present in our data and is robust to various econometric specifications and samples.

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File URL: http://www.nber.org/papers/w16084.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 16084.

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Date of creation: Jun 2010
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Publication status: published as “Are Free Trade Agreements Contagious?”, with Dany Jaimovich, Journal of International Economics, Volume 88, Issue 1, September 2012, Pages 1–16.
Handle: RePEc:nbr:nberwo:16084
Note: ITI
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  46. Melatos, Mark & Woodland, Alan, 2007. "Endogenous trade bloc formation in an asymmetric world," European Economic Review, Elsevier, vol. 51(4), pages 901-924, May.
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