GDL

Journal from gdlhub / 2017-08-14 11:52:53
Oleh : Scott L. Baier , Jeffrey H. Bergstrand, ELSEVIER (bergstrand.1@nd.edu (J.H. Bergstrand).)
Dibuat : 2010-06-29, dengan 1 file

Keyword : Economic, determinants, free, trade, agreements
Url : http://www.elsevier.com/locate/econbase

The purpose of this study is to provide the first systematic empirical analysis of the economic


determinants of the formation of free trade agreements (FTAs) and of the likelihood of FTAs between


pairs of countries using a qualitative choice model. We develop this econometric model based upon a


general equilibrium model of world trade with two factors of production, two monopolistically-


competitive product markets, and explicit intercontinental and intracontinental transportation costs


among multiple countries on multiple continents. The empirical model correctly predicts, based


solely upon economic characteristics, 85% of the 286 FTAs existing in 1996 among 1431 pairs of


countries and 97% of the remaining 1145 pairs with no FTAs.

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