The Political Economy of Preferential Trade Agreements: Latin America and Beyond

2012 ◽  
Vol 54 (1) ◽  
pp. 181-196
Author(s):  
Laura Gómez-Mera ◽  
Beverly Barrett
Keyword(s):  
Political Economy ◽  
Latin America ◽  
Trade Agreements ◽  
Preferential Trade Agreements ◽  
The Political ◽  
Preferential Trade

Endogenous Preferential Trade Agreements: An Empirical Analysis

2003 ◽  
Vol 2 (1) ◽  
Author(s):  
Christopher S Magee
Keyword(s):  
Political Economy ◽  
Empirical Analysis ◽  
Bilateral Trade ◽  
Trade Agreement ◽  
Trade Agreements ◽  
Preferential Trade Agreements ◽  
The Political ◽  
Preferential Trade ◽  
Trading Partners ◽  
Regional Agreements

Abstract This paper provides one of the first assessments of the hypothesis that two countries are more likely to form a preferential trade agreement (PTA) if they are already major trading partners. The paper also tests a number of predictions from the political economy literature about which countries are expected to form regional agreements. The results show that countries are more likely to be preferential trading partners if they have significant bilateral trade, are similar in size, and are both democracies. Finally, the paper measures the effect of preferential agreements on trade volumes while, unlike previous studies, treating PTA formation as endogenous.

scholarly journals Economic Growth Creation Or Diversion? The Record of Trade Agreements In Latin America

1970 ◽  
Vol 27 (1) ◽  
pp. 93-122
Author(s):  
Gustavo Barboza ◽  
Sandra Trejos
Keyword(s):  
Economic Growth ◽  
Latin America ◽  
Labor Force ◽  
Trade Openness ◽  
Trade Agreements ◽  
Output Growth ◽  
Preferential Trade Agreements ◽  
Preferential Trade ◽  
Positive Effect ◽  
Capita Output

This paper examines the effects of Preferential Trade Agreements (PTAs) andGATT/WTO membership on economic growth using a sample of seventeen LatinAmerican countries for the period 1950-2004. In general, the evidence indicatesthat the proliferation of bilateral and multi country regional and extra regional tradeagreements has not resulted in faster economic growth. On the contrary, we find thatPTAs and WTO only have a weak positive effect on increasing trade openness; butthis relationship does not translate into faster economic growth when controlling forcapital, labor force and trade openness. These results are robust to both static anddynamic model specifications, indicating that trade openness has a positive effect onper capita output growth, but PTA and WTO membership do not. Integration via defacto increases output growth while integration via de jure does not. Based on theresults, PTAs create a net diversion effect on economic growth.

scholarly journals The Political Economy of Preferential Trade Agreements: An Empirical Investigation*

2021 ◽  
Author(s):  
Giovanni Facchini ◽  
Peri Silva ◽  
Gerald Willmann
Keyword(s):  
Political Economy ◽  
Theoretical Analysis ◽  
Empirical Investigation ◽  
Bilateral Trade ◽  
Strong Support ◽  
Trade Agreements ◽  
Preferential Trade Agreements ◽  
The Political ◽  
Economy Model ◽  
Customs Unions

Abstract We develop a political economy model to study the decision of representative democracies to join a preferential trading agreement (PTA), distinguishing between free trade areas (FTA) and customs unions (CU). Our theoretical analysis shows that bilateral trade imbalances and income inequality are important factors determining the formation of PTAs, whereas the patterns of geographic specialisation explain whether a CU or an FTA will emerge. Our empirical analysis - using a comprehensive panel dataset spanning 187 countries over the period 1960-2015 - provides strong support for these predictions.

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