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Regional integration: what is in it for CARICOM?

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  • Moreira, Maurício Mesquita
  • Mendoza, Eduardo

Abstract

La integración política y económica se ha constituido en un tema neurálgico de la agenda caribeña. Este trabajo analiza literatura sobre comercio, crecimiento y acuerdos regionales para discutir sobre la motivación que subyace en la región del Caribe por la integración, los resultados obtenidos hasta ahora y con qué cuentan a futuro. Se analiza con la ayuda de la estadística descriptiva, un modelo de crecimiento empírico y un modelo gravitacional que establecen que los beneficios tradicionales relacionados al comercio que se derivan de la integración regional han estado, y están, destinados a estar limitados debido a (1) el alto grado de apertura de los países; (2) el tamaño limitado del mercado "común" agrandado; y (3) la dotación factorial relativamente similar de los países. El documento también señala que las ganancias en el área de "no comerciables" - debido a las economías de escala y que no se pueden mitigar por medio del comercio y la apertura - pueden ser sustanciales = Economic and political integration have been a perennial and neuralgic issue in the Caribbean agenda. This paper draws on the literature on trade, growth and regional agreements to discuss the motivation behind the Caribbean drive for integration, the results obtained so far and what is in stock for the future. It argues, with the help of descriptive statistics, an empirical growth model and a gravity model, that the traditional, trade related gains from regional integration have been and are bound to be limited because of (1) the countries' high openness; (2) the limited size of the "common", enlarged market; and (3) the countries' relatively similar factor endowments. It also argues, though, that gains in the area of "non-tradables", due to economies of scale which cannot be mitigated by trade and openness, can be substantial = A integraçao política e econômica tornaram-se uma questao nevrálgica da agenda caribenha. Este trabalho analise a literatura
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Suggested Citation

  • Moreira, Maurício Mesquita & Mendoza, Eduardo, 2007. "Regional integration: what is in it for CARICOM?," LSE Research Online Documents on Economics 123211, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:123211
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    Cited by:

    1. Holt, Charles A. & Porzio, Megan & Song, Michelle Yingze, 2017. "Price bubbles, gender, and expectations in experimental asset markets," European Economic Review, Elsevier, vol. 100(C), pages 72-94.
    2. Juan Carlos Cuestas & Carlyn Ramlogan-Dobson, 2013. "Convergence of Inflationary Shocks: Evidence from the Caribbean," The World Economy, Wiley Blackwell, vol. 36(9), pages 1229-1243, September.
    3. Juan Carlos Cuestas & Carlyn Dobson, 2011. "Inflation persistence: Implication for a monetary union in the Caribbean," Working Papers 2011017, The University of Sheffield, Department of Economics.
    4. Alain Maurin & Roland Craigwell, 2010. "Are Caribbean Countries Diverging or Converging? Evidence from Spatial Econometrics," Post-Print hal-04052136, HAL.
    5. Eric Pentecost & Paul Turner, 2010. "Demand and Supply Shocks in the Caribbean Economies: Implications for Monetary Union," The World Economy, Wiley Blackwell, vol. 33(10), pages 1325-1337, October.

    More about this item

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean

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