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RTAs' Proliferation and Trade-Diversion Effects: Evidence of the "Spaghetti Bowl" Phenomenon

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  • Sorgho, Zakaria

Abstract

This paper investigates the trade-diversion effects of regional trade agreements (RTAs), so-called “Spaghetti bowl” Phenomenon (SBP), in multilateral trade. The SBP is due to the proliferation of RTAs. Thus, I investigate the relationship between the number of RTAs concluded by a country and the additional trade value attributed to an RTA. Using bilateral trade data in a sample of 119 countries, from 1995 to 2012, my main finding reveals a negative trade-effect between them, confirming the existence of SBP multilateral trade. However, results could not conclude evidence of a negative effect of overlapping RTAs, involving the existence of SBP, within North-North, North-South or South-South trade. But, the additional trade value attributed to an RTA concluded with EU countries or US seems to confirm significantly a trade-diversion effect because of the number of RTAs signed by these countries.

Suggested Citation

  • Sorgho, Zakaria, 2015. "RTAs' Proliferation and Trade-Diversion Effects: Evidence of the "Spaghetti Bowl" Phenomenon," Working Papers 206223, University of Laval, Center for Research on the Economics of the Environment, Agri-food, Transports and Energy (CREATE).
    • Handle: RePEc:ags:ulavwp:206223
    DOI: 10.22004/ag.econ.206223
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