Scott Baier, Yoto Yotov, Thomas Zylkin, 28 April 2017

There is a large empirical literature examining the effects of free trade agreements. However, most studies to date have focused on a common average effect across all agreements or have assumed that the effects are common across similar types of agreements. This column examines heterogeneity in the effects of free trade agreements. Along with across-agreement heterogeneity, substantial within-agreement heterogeneity is observed. The effects of a specific agreement can be starkly different for two trading partners.

Jayant Menon, 10 April 2013

So far, research on the impacts of free trade agreements in east Asia assume the full utilisation of preferences. This column argues that newer evidence suggests that this assumption is made in error: estimated uptake is particularly low in east Asia. If we assume a more realistic utilisation rate in estimating impacts, results suggest that actual utilisation rates significantly diminish the benefits from preferential liberalisation, but in a non-linear way. In the absence of Doha, the multilateralisation of preferences, even without reciprocity, is the practical route that is most likely to deliver the greatest benefits to WTO members.

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