Preferential Rules of Origin in Regional Trade Agreements

Preferential Trade Agreements

Global Supply Chains, Trade Agreements and Rules of Origin

Free Trade Agreements (FTAs) usually come with restrictions on the use of intermediate inputs in order for final goods to qualify for free trade. I focus on Rules of Origin (RoO), which limit expenses on nonmember country’s intermediate inputs. In a three-country FTA formation game, I introduce international trade in intermediate inputs and RoO restrictions. In the case of symmetric countries, ...

Tariff Adjustments in Preferential Trade Agreements

In this paper we examine how preferential trade liberalization affects the terms of trade, external tariffs and welfare of the integrating countries and the rest of the world. Our analysis is based on a three-country, three-good, general equilibrium model with symmetric customs union (CU) members. The model generalizes previous work by considering more general consumer preferences and productio...

Regional Trade Agreements: Effects on Trade

positive or negative effects on trade depending on their design and implementation. Analysis in this chapter confirms that gains from a preferential trade agreement cannot be taken for granted; moreover, even in agreements with positive impacts on average incomes, not all members are assured of increases. The interesting policy question then is not whether RTAs are categorically good or bad, bu...

The Trade Effects of Endogenous Preferential Trade Agreements

Recent work by Anderson and van Wincoop (2003) establishes an empirical modeling strategy which takes full account of the structural, non-(log-)linear impact of trade barriers on trade in new trade theory models. Structural new trade theory models have never been used to evaluate and quantify the role of endogenous preferential trade agreement (PTA) membership for trade in a way which is consis...