IDEAS home Printed from https://ideas.repec.org/p/wbk/wbrwps/885.html

The impact of EC-92 on developing countries'trade : a dissenting view

Author

Listed:
  • Hughes Hallett,Andrew J.

Abstract

Most benefits of the European Community (EC-92) program will probably not come from marginal changes in trade flows. Those changes are important to European policymakers, but are of remote interest to developing countries. The main threats to developing countries are the diversion of investment funds to EC countries and continued external barriers, especially nontariff barriers. The EC expects higher growth and lower prices as a result of EC-92. The net effect on developing countries of the removal of internal trade barriers depends on the country's income and price elasticities with the EC. Current estimates suggest the effect will be small. If new external barriers emerge, or if EC-wide barriers replace national barriers, EC firms may collaborate more with large US or Japanese firms. None of these developments will improve developing countries'trade in manufactures and services. Investment in EC countries may increase to meet the extra demand, growth, or trade diversion resulting from EC-92. This could lead to increased investments in developing countries but given heavy indebtedness in developing countries, is more likely to divert investment funds, thus limiting their future production and growth. Technical standards in EC-92 may also be tougher than national standards in member countries, which could hurt developing country exporters. Is"Fortress Europe"likely? The EC Commission says no, but the Community's record is not good.

Suggested Citation

  • Hughes Hallett,Andrew J., 1992. "The impact of EC-92 on developing countries'trade : a dissenting view," Policy Research Working Paper Series 885, The World Bank.
    • Handle: RePEc:wbk:wbrwps:885
    as

    Download full text from publisher

    File URL: http://documents.worldbank.org/curated/en/573801468739250943/pdf/multi0page.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Winters, L. Alan, 1988. "Completing the European internal market : Some notes on trade policy," European Economic Review, Elsevier, vol. 32(7), pages 1477-1499, September.
    2. Phedon Nicolaides, 1990. "Responding to European Integration: Developing Countries and Services," Journal of Common Market Studies, Wiley Blackwell, vol. 29(2), pages 201-215, December.
    3. Rolf J. Langhammer, 1990. "Fuelling a New Engine of Growth or Separating Europe from Non‐Europe?," Journal of Common Market Studies, Wiley Blackwell, vol. 29(2), pages 133-155, December.
    4. Jeffrey J. Schott, 1991. "Trading Blocs and the World Trading System," The World Economy, Wiley Blackwell, vol. 14(1), pages 1-18, March.
    5. Morris Goldstein & Mohsin S. Khan, 2017. "Income and Price Effects in Foreign Trade," World Scientific Book Chapters, in: TRADE CURRENCIES AND FINANCE, chapter 1, pages 3-81, World Scientific Publishing Co. Pte. Ltd..
    6. Sapir, Andre, 1998. "The political economy of EC regionalism," European Economic Review, Elsevier, vol. 42(3-5), pages 717-732, May.
    7. Messerlin, Patrick A., 1990. "Antidumping regulations or procartel law? : the European Community chemical cases," Policy Research Working Paper Series 397, The World Bank.
    8. Smith, Alasdair & Venables, Anthony J., 1988. "Completing the internal market in the European Community : Some industry simulations," European Economic Review, Elsevier, vol. 32(7), pages 1501-1525, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Razin, Assaf & Sadka, Efraim & Coury, Tarek, 2003. "Trade openness, investment instability and terms-of-trade volatility," Journal of International Economics, Elsevier, vol. 61(2), pages 285-306, December.
    2. Assaf Razin & Efraim Sadka & Tarek Coury, 2002. "Trade Openness and Investment Instability," NBER Working Papers 8827, National Bureau of Economic Research, Inc.
    3. Angresano, James, 2004. "European Union integration lessons for ASEAN + 3: the importance of contextual specificity," Journal of Asian Economics, Elsevier, vol. 14(6), pages 909-926, January.
    4. An, Lian & Kim, Gil & Ren, Xiaomei, 2014. "Is devaluation expansionary or contractionary: Evidence based on vector autoregression with sign restrictions," Journal of Asian Economics, Elsevier, vol. 34(C), pages 27-41.
    5. De Bonis, Valeria, 1997. "Regional integration and factor income taxation," Policy Research Working Paper Series 1849, The World Bank.
    6. Jaime de Melo & David Tarr, 2015. "VERs under imperfect competition and foreign direct investment: A case study of the US–Japan auto VER," World Scientific Book Chapters, in: Modeling Developing Countries' Policies in General Equilibrium, chapter 22, pages 461-483, World Scientific Publishing Co. Pte. Ltd..
    7. Clarida, Richard H, 1994. "Cointegration, Aggregate Consumption, and the Demand for Imports: A Structural Econometric Investigation," American Economic Review, American Economic Association, vol. 84(1), pages 298-308, March.
    8. repec:hum:wpaper:sfb649dp2007-042 is not listed on IDEAS
    9. Stefano Chiarlone, 2000. "Trade of quality differentiated goods and import elasticities," LIUC Papers in Economics 72, Cattaneo University (LIUC).
    10. Giordano, Claire & Lopez-Garcia, Paloma, 2019. "Firm heterogeneity and trade in EU countries: a cross-country analysis," Occasional Paper Series 225, European Central Bank.
    11. Shahe Emran, M. & Shilpi, Forhad, 1996. "Foreign exchange rationing and the aggregate import demand function," Economics Letters, Elsevier, vol. 51(3), pages 315-322, June.
    12. Martin Gürtler, 2019. "Dynamic analysis of trade balance behavior in a small open economy: the J-curve phenomenon and the Czech economy," Empirical Economics, Springer, vol. 56(2), pages 469-497, February.
    13. Mohamed Bouzahzah & Hamid Esmaeili & Abid Ihadiyan, 2007. "Ouverture commerciale et migration," L'Actualité Economique, Société Canadienne de Science Economique, vol. 83(1), pages 71-90.
    14. G Ottaviano & Diego Puga, 1997. "Agglomeration in a global Economy: A Survey," CEP Discussion Papers dp0356, Centre for Economic Performance, LSE.
    15. Koichiro Kamada & Ko Nakayama & Izumi Takagawa, 2002. "Deepening Interdependence in the Asia-Pacific Region: An Empirical Study Using a Macro-Econometric Model," Bank of Japan Working Paper Series Research and Statistics D, Bank of Japan.
    16. Sajal Lahiri & Anjum Nasim, 2005. "Commercial Policy Reform in Pakistan: Opening up the Economy under Revenue Constraints," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 12(6), pages 723-739, November.
    17. Taran Fæhn, 2002. "The Qualitative and Quantitative Significance of Non-Tariff Barriers: An ERP study of Norway," Economic Systems Research, Taylor & Francis Journals, vol. 14(1), pages 35-57.
    18. Nicolas Schmitt, 1990. "New International Trade Theories and Europe 1992: Some Results Relevant for EFTA Countries," Journal of Common Market Studies, Wiley Blackwell, vol. 29(1), pages 53-73, September.
    19. Baldwin, Richard E. & Seghezza, Elena, 1996. "The New Growth Theory: Its Logic and Trade Policy Implications," 1996: Implications of the New Growth Theory to Agricultural Trade Research and Trade Policy Conference, December 1996, Washington DC 50862, International Agricultural Trade Research Consortium.
    20. Mayer, Thierry & Steingress, Walter, 2020. "Estimating the effect of exchange rate changes on total exports," Journal of International Money and Finance, Elsevier, vol. 106(C).
    21. Stéphane Capet & Philippe Gudin de Vallerin, 1993. "Fonctions d'importations et d'exportations : l'apport de la théorie économétrique récente," Économie et Prévision, Programme National Persée, vol. 107(1), pages 15-36.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:885. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Roula I. Yazigi (email available below). General contact details of provider: https://edirc.repec.org/data/dvewbus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.