Does Mercosur's Trade Performance Raise Concerns About the Effects of Regional Trade Arrangements?

摘要: Do the discriminatory trade barriers applied in regional arrangements encourage high-cost imports from member countries at expense of lower-cost goods nonmembers? In discussions about (RTAs), one concern has been whether RTAs nonmembers. But evaluations impact have hampered by a lack appropriate empirical procedures for assessing their influence on level and direction trade. Yeats employs new index analyzing static effects an RTA. He examines changes orientation exports shows how this information can be employed connection with revealed comparative advantage (RCA) to identify apparent inefficiencies patterns. applies approach statistics Mercosur countries' determine if recent is evolving along lines current compatible these advantage. does not comment many other possible RTAs, such as benefits political cooperation, enhancing credibility reform strategies, or dynamic gains Nor he focus directly nonmembers, that accelerated rapidly because 1988-91 liberalization countries. Thus paper address net welfare creation diversion relative 1988 policies The results show most (fast-growing) products Mercosur's intra-trade generally are capital-intensive which members displayed strong export performance outside markets. Neither RCA indices nor factor proportions indicate those products. evidence suggests own responsible changes. Most-favored-nation tariffs fast-growing above average all provide significant preferences. These findings constitute potential adverse third countries, judged variance patterns what would predict. Although there standards, counterfactual comparison used equivalent degree nondiscriminatory basis. Given proliferation they highlight need further research domestic international arrangements, better assess pros cons regionalism. This - product International Trade Division, Economics Department part larger effort department study regionalism development.