This paper discusses the impact of information costs on the organisation of international trade. The conditions under which trade is organized through an information intermediary, the incentives for network building and the implications for trade volumes are analysed using a stylised model. The model illustrates how information barriers can affect the way trade is organised. The model shows how...

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...

Using a simple general equilibrium model with two countries and two sectors including one manufacturing sector producing (vertically) differentiated products, we first show that an international barrier to trade in the manufacturing sector creates inter-industry trade, whereas an international barrier to trade in the other sector generates intra-industry trade among vertically differentiated pr...

As the chances of a successful conclusion to the Doha Round of trade liberalization under the WTO become increasingly problematic, so the pace of negotiating local free trade agreements (FTAs) is increasing. According to the WTO report, countries in the Asia-Pacific region are “consolidating their drive towards regionalism at an accelerated pace”. After the trade agreements between China an...

The Transatlantic Trade and Investment Partnership (“TTIP”) has been hailed as an opportunity for the world’s two largest consumer markets to expand inter-regional trade, investment and jobs, and to secure greater regulatory convergence that could considerably reduce costly and market-distorting extra-territorial non-tariff regulatory trade barriers.1 As fears of potential adverse effects on th...

Traditional trade policy tools like tariffs and quotas are being actively replaced with non-tariff policy tools (NTB) by governments throughout the world. In this paper we investigate how introduction of two types of non-tariff measures, technical barriers to trade (TBT) and sanitary and phytosanitary (SPS) measures, affects exporters in different countries. According to the heterogeneous firms...

We discuss metrics of globalization for individual economies as distance measures between fully integrated and trade restricted equilibria in economies initially operating under less than full integration with the global economy. Such metrics can be used to construct country globalization metrics reflecting the distance of economies from full global integration due to trade barriers, barriers t...