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Trade Creation and Diversion Effects of Europe???s Regional Liberalization Agreements

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  • Yener Kandogan

Abstract

After a short background on recent developments in gravity modelling and liberalization agreements in Europe, this paper measures the trade creation and diversion effects of major European agreements based on the results of a correctly specified triple-indexed gravity model with bilateral fixed effects. For each agreement and partner country, welfare implications are discussed in sectors of different factor intensities with emphasis on the role of similarity in income or relative factor endowments between partners, as well as the date and the reciprocity of the agreement. This is followed by a description of the characteristics of the non-partner countries that are affected by these agreements in each sector.

Suggested Citation

  • Yener Kandogan, 2005. "Trade Creation and Diversion Effects of Europe???s Regional Liberalization Agreements," William Davidson Institute Working Papers Series wp746, William Davidson Institute at the University of Michigan.
    • Handle: RePEc:wdi:papers:2005-746
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    Cited by:

    1. Vassilis Monastiriotis, 2008. "Quo Vadis Southeast Europe? EU Accession, Regional Cooperation and the need for a Balkan Development Strategy," GreeSE – Hellenic Observatory Papers on Greece and Southeast Europe 10, Hellenic Observatory, LSE.
    2. Mirajul Haq & Javeria Saeed & Muhammad Akram, 2021. "Exploring the Advantages and Disadvantages of the China–Pakistan Free Trade Agreement," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 29(3), pages 83-103, May.
    3. Asci, Serhat C. & Paggi, Mechel & Yamazaki, Fumiko, 2016. "Implications of Trans-Pacific Partnership for the US Dairy Industry," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 19(B), pages 1-16, August.

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    More about this item

    Keywords

    Gravity Model; Fixed Effects;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration

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