Returns to Regionalism: An Analysis of Nontraditional Gains from Regional Trade Agreements

Raquel Fernández, Jonathan Portes

    Research output: Contribution to journalArticlepeer-review

    Abstract

    The past decade has witnessed a renewed interest in regional trade agreements, with many policymakers and academics seeming to believe that these provide more than the traditional gains from trade. This article examines several possible benefits that regional trade agreements may confer on their partners, including credibility, signaling, bargaining power, insurance, and coordination. It assesses the necessary conditions for each possible channel to work, gives stylized examples of specific types of policy where the benefit might be applicable, examines cases where the explanation might be relevant, and discusses their overall plausibility. It concludes by examining the North American Free Trade Agreement and the Europe Agreements.

    Original languageEnglish (US)
    Pages (from-to)197-220
    Number of pages24
    JournalWorld Bank Economic Review
    Volume12
    Issue number2
    DOIs
    StatePublished - May 1998

    ASJC Scopus subject areas

    • Accounting
    • Development
    • Finance
    • Economics and Econometrics

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