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Non-Preferential Trading Clubs

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  • Raimondos-Møller, Pascalis

    (Department of Economics, Copenhagen Business School)

  • Woodland , Alan D.

    (Department of Economics, Copenhagen Business School)

Abstract

This paper examines the welfare implications of non-discriminatory tariff reforms by a subset of countries, which we term a non-preferential trading club. We show that there exist coordinated tariff reforms, accompanied by appropriate income transfers between the member countries, that unambiguously increase the welfare of these countries while leaving the welfare of non-members unaltered. In terms of economic policy implications, our results show that there exist regional, MFN-consistent arrangements that lead to Pareto improvements in world welfare.

Suggested Citation

  • Raimondos-Møller, Pascalis & Woodland , Alan D., 2006. "Non-Preferential Trading Clubs," Working Papers 06-2004, Copenhagen Business School, Department of Economics.
    • Handle: RePEc:hhs:cbsnow:2004_006
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    Cited by:

    1. Subhayu Bandyopadhyay & Sajal Lahiri & Suryadipta Roy, 2011. "Political Asymmetry And Common External Tariffs In A Customs Union," Economics and Politics, Wiley Blackwell, vol. 23(1), pages 88-106, March.
    2. Subhayu Bandyopadhyay & Sajal Lahiri & Suryadipta Roy, 2008. "Enlargement and common external tariff in a political-economic model of customs union," Working Papers 2008-022, Federal Reserve Bank of St. Louis.
    3. Kemp, Murray C., 2007. "Normative comparisons of customs unions and other types of free trade association," European Journal of Political Economy, Elsevier, vol. 23(2), pages 416-422, June.
    4. Subhayu Bandyopadhyay & Sajal Lahiri & Howard J. Wall, 2009. "Cross-border lobbying in preferential trading agreements: implications for external tariffs," Working Papers 2009-041, Federal Reserve Bank of St. Louis.
    5. Pascalis Raimondos & Alan D. Woodland, 2011. "Reciprocity, World Prices and Welfare," CESifo Working Paper Series 3607, CESifo.
    6. Chang, Winston W. & Chen, Tai-Liang & Saito, Tetsuya, 2021. "Formation of symmetric free-trade blocs, optimal tariff structure, and world welfare," Journal of Asian Economics, Elsevier, vol. 77(C).
    7. George Manzano & Myrene Bedano, 2011. "Revisiting Sectoral Liberalization: An Alternative to the Free Trade Area of the Asia-Pacific? Implications for the Philippines," Asia-Pacific Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 18(1), pages 73-124, June.

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    More about this item

    Keywords

    Trading clubs; non-preferential tariff reform; Kemp-Wan-Ohyama proposition;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration

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