Third-Country Effects of Regional Trade Agreements : A Firm-Level Analysis

Do regional trade agreements negatively impact non-members? This paper revisits this long-standing trade policy question using firm-level data and detailed information on the content of trade agreements. Differently from the conventional view on tr...

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Main Authors:	Lee, Woori, Mulabdic, Alen, Ruta, Michele
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2019
Subjects:	REGIONAL TRADE AGREEMENTS DEEP INTEGRATION REGIONAL INTEGRATION FIRM-LEVEL DATA EXTENDED GRAVITY GRAVITY MODEL TRADE DIVERSION POSITIVE SPILLOVER
Online Access:	http://documents.worldbank.org/curated/en/110561574281995016/Third-Country-Effects-of-Regional-Trade-Agreements-A-Firm-Level-Analysis http://hdl.handle.net/10986/32673

id	okr-10986-32673
recordtype	oai_dc
spelling	okr-10986-326732022-09-20T00:11:54Z Third-Country Effects of Regional Trade Agreements : A Firm-Level Analysis Lee, Woori Mulabdic, Alen Ruta, Michele REGIONAL TRADE AGREEMENTS DEEP INTEGRATION REGIONAL INTEGRATION FIRM-LEVEL DATA EXTENDED GRAVITY GRAVITY MODEL TRADE DIVERSION POSITIVE SPILLOVER Do regional trade agreements negatively impact non-members? This paper revisits this long-standing trade policy question using firm-level data and detailed information on the content of trade agreements. Differently from the conventional view on trade diversion, the analysis identifies a positive spillover effect of regional trade agreements: they increase the probability of export and entry of third-country firms that previously exported to one of the member countries. This spillover effect is driven by deeper trade agreements, as they make member countries more "similar" in terms of the regulatory environment. Indeed, firms exporting regulation-intensive products benefit disproportionately more from deep trade agreements in destination markets, especially if the agreement includes nondiscriminatory provisions and addresses regulatory issues. 2019-11-21T20:34:43Z 2019-11-21T20:34:43Z 2019-11 Working Paper http://documents.worldbank.org/curated/en/110561574281995016/Third-Country-Effects-of-Regional-Trade-Agreements-A-Firm-Level-Analysis http://hdl.handle.net/10986/32673 English Policy Research Working Paper;No. 9064 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	REGIONAL TRADE AGREEMENTS DEEP INTEGRATION REGIONAL INTEGRATION FIRM-LEVEL DATA EXTENDED GRAVITY GRAVITY MODEL TRADE DIVERSION POSITIVE SPILLOVER
spellingShingle	REGIONAL TRADE AGREEMENTS DEEP INTEGRATION REGIONAL INTEGRATION FIRM-LEVEL DATA EXTENDED GRAVITY GRAVITY MODEL TRADE DIVERSION POSITIVE SPILLOVER Lee, Woori Mulabdic, Alen Ruta, Michele Third-Country Effects of Regional Trade Agreements : A Firm-Level Analysis
relation	Policy Research Working Paper;No. 9064
description	Do regional trade agreements negatively impact non-members? This paper revisits this long-standing trade policy question using firm-level data and detailed information on the content of trade agreements. Differently from the conventional view on trade diversion, the analysis identifies a positive spillover effect of regional trade agreements: they increase the probability of export and entry of third-country firms that previously exported to one of the member countries. This spillover effect is driven by deeper trade agreements, as they make member countries more "similar" in terms of the regulatory environment. Indeed, firms exporting regulation-intensive products benefit disproportionately more from deep trade agreements in destination markets, especially if the agreement includes nondiscriminatory provisions and addresses regulatory issues.
format	Working Paper
author	Lee, Woori Mulabdic, Alen Ruta, Michele
author_facet	Lee, Woori Mulabdic, Alen Ruta, Michele
author_sort	Lee, Woori
title	Third-Country Effects of Regional Trade Agreements : A Firm-Level Analysis
title_short	Third-Country Effects of Regional Trade Agreements : A Firm-Level Analysis
title_full	Third-Country Effects of Regional Trade Agreements : A Firm-Level Analysis
title_fullStr	Third-Country Effects of Regional Trade Agreements : A Firm-Level Analysis
title_full_unstemmed	Third-Country Effects of Regional Trade Agreements : A Firm-Level Analysis
title_sort	third-country effects of regional trade agreements : a firm-level analysis
publisher	World Bank, Washington, DC
publishDate	2019
url	http://documents.worldbank.org/curated/en/110561574281995016/Third-Country-Effects-of-Regional-Trade-Agreements-A-Firm-Level-Analysis http://hdl.handle.net/10986/32673
_version_	1764477043811024896

Third-Country Effects of Regional Trade Agreements : A Firm-Level Analysis

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