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Preferential Trade Agreements and Their Role in World Trade

The author investigates the effects of preferential trade agreements (PTAs) on bilateral trade flows using a comprehensive database of PTAs in force and a detailed matrix of world trade. He shows that total trade between PTA partners is a poor proxy for preferential trade (trade in tariff lines wher...

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Bibliographic Details
Main Author: Medvedev, Denis
Language:English
en_US
Published: World Bank, Washington, DC 2012
Subjects:
AD VALOREM
AGREEMENT ON TRADE
ANDEAN PACT
ANTI-DUMPING DUTY
BASE YEAR
BILATERAL AGREEMENTS
BILATERAL TRADE
CENTRAL AMERICAN
CHANGES IN TRADE
COMMON MARKET
COMPETITION POLICIES
CONCESSIONS
CONSUMER PREFERENCES
CURRENCY
CURRENCY UNION
CURRENCY UNIONS
CUSTOMS
CUSTOMS PROCEDURES
CUSTOMS UNION
CUSTOMS UNIONS
DATE OF ENTRY INTO FORCE
DEVELOPING REGIONS
DUMPING
ECONOMIC COOPERATION
ECONOMIC RELATIONS
ELASTICITY
EUROPEAN UNION
EXCHANGE RATE
EXPORT DIVERSION
EXPORT PRODUCTS
EXPORTS
EXTERNAL PROTECTION
EXTERNAL TARIFF
FREE TRADE
FREE TRADE AGREEMENT
FREE TRADE AREA
FREE TRADE AREAS
FUNCTIONAL FORMS
GATS
GDP
GDP PER CAPITA
GENERAL AGREEMENT ON TRADE IN SERVICES
GENERAL SYSTEM OF PREFERENCES
GLOBAL FREE TRADE
GLOBAL LEVEL
GLOBAL TRADE
GLOBAL TRADING
GRAVITY APPROACH
GRAVITY EQUATION
GRAVITY ESTIMATES
GRAVITY FRAMEWORK
GRAVITY MODEL
GRAVITY MODELS
IMPORT DATA
IMPORTED GOODS
IMPORTS
INCOME
INCOME ELASTICITIES
INCOME GROUPS
INTEGRATION AGREEMENTS
INTERNATIONAL TRADE
LATIN AMERICAN
MARKET ACCESS
MARKET STRUCTURE
MERCHANDISE TRADE FLOWS
MFN
MOST FAVORED NATION
MULTILATERAL TARIFFS
MULTIPLE AGREEMENTS
MUTUAL RECOGNITION
MUTUAL RECOGNITION OF STANDARDS
POLICY RESEARCH
POTENTIAL BENEFITS
PREFERENTIAL AGREEMENT
PREFERENTIAL AGREEMENTS
PREFERENTIAL BASIS
PREFERENTIAL IMPORTS
PREFERENTIAL LIBERALIZATION
PREFERENTIAL RATES
PREFERENTIAL REGIME
PREFERENTIAL SCHEME
PREFERENTIAL TRADE
PREFERENTIAL TRADE AGREEMENTS
RECIPROCITY
REGIONAL TRADE
RULES OF ORIGIN
SPECIFIC COMMITMENTS
SUB-SAHARAN AFRICA
SYSTEM OF PREFERENCES
TARIFF DATA
TARIFF LINE
TARIFF LINES
TARIFF REDUCTION
TARIFF REGIMES
TARIFF SCHEDULES
TARIFF STRUCTURE
TRADE AGREEMENT
TRADE BARRIERS
TRADE COMMISSION
TRADE COSTS
TRADE CREATION
TRADE DIVERSION
TRADE FLOW
TRADE FLOW DATA
TRADE FLOWS
TRADE IN GOODS
TRADE LIBERALIZATION
TRADE POLICY
TRADE POLICY AGENDA
TRADE STRUCTURE
TRADE VARIABLES
TRADE VOLUMES
TRADING PARTNERS
TRADING SYSTEM
TREATMENT
UNILATERAL PREFERENCES
VALUE OF TRADE
WORLD TRADE
WORLD TRADE ORGANIZATION
WTO
Online Access:http://documents.worldbank.org/curated/en/2006/10/7129768/preferential-trade-agreements-role-world-trade
http://hdl.handle.net/10986/9012
Description
Summary:The author investigates the effects of preferential trade agreements (PTAs) on bilateral trade flows using a comprehensive database of PTAs in force and a detailed matrix of world trade. He shows that total trade between PTA partners is a poor proxy for preferential trade (trade in tariff lines where preferences are likely to matter): while the former amounted to one-third of global trade in 2000-02, the latter was between one-sixth and one-tenth of world trade. His gravity model estimates indicate that using total rather than preferential trade to assess the impact of PTAs leads to a significant downward bias in the PTA coefficient. The author finds that product exclusions and long phase-in periods significantly limit preferential trade, and their removal could more than double trade in tariff lines above 3 percent of most-favored-nation (MFN) duties. He also shows that the effects of PTAs on trade vary by type of agreement and are increasing in the incomes of PTA partners.

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