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Who wins from an FTA induced revival of world trade?

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  • Breuss, Fritz

Abstract

The last decade has been characterized by a slowdown in globalization, referred to by some as "slowbalisation" and “deglobalization”. The COVID-19 pandemic has reinforced this impression. To overcome the deadlock in the Doha round negotiations at WTO the major players in world trade are negotiating or have already implemented several free trade agreements (FTAs) as a second-best solution. We analyze within a common framework nine mega FTAs, some of them are already in effect, others will be enacted soon. Overall, not the big players in world trade, the EU and the United States win by a simultaneous implementation of the nine FTAs. Japan would be the winner because it participates in four combinations (overlaps) of FTAs: EU-Japan, USA-Japan, CPTPP and RCEP. The United States hardly gain from further globalization. Similarly, the EU27 cannot profit much from further globalization.

Suggested Citation

  • Breuss, Fritz, 2022. "Who wins from an FTA induced revival of world trade?," Journal of Policy Modeling, Elsevier, vol. 44(3), pages 653-674.
    • Handle: RePEc:eee:jpolmo:v:44:y:2022:i:3:p:653-674
    DOI: 10.1016/j.jpolmod.2022.05.003
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    References listed on IDEAS

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    1. Bown, Chad P., 2021. "The US–China trade war and Phase One agreement," Journal of Policy Modeling, Elsevier, vol. 43(4), pages 805-843.
    2. Rahel Aichele & Gabriel Felbermayr, 2014. "CETA: Welche Effekte hat das EU-Kanada-Freihandelsabkommen auf Deutschland?," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 67(24), pages 20-30, December.
    3. Chad P. Bown, 2021. "The US–China trade war and phase one agreement," Working Paper Series WP21-2, Peterson Institute for International Economics.
    4. Julia Grübler & Oliver Reiter & Robert Stehrer, 2018. "The EU-Japan Economic Partnership Agreement and its Relevance for the Austrian Economy," wiiw Research Reports 434, The Vienna Institute for International Economic Studies, wiiw.
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    Cited by:

    1. Beckman, Jayson & Ivanic, Maros & Shaik, Saleem, 2023. "How bilateral trade deals get in the way of multilateral agreements: Why WTO is marginalized," Journal of Policy Modeling, Elsevier, vol. 45(5), pages 877-894.

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    More about this item

    Keywords

    Globalization; International trade policy; Model simulations;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F60 - International Economics - - Economic Impacts of Globalization - - - General
    • C54 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Quantitative Policy Modeling
    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models

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