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Implications of preferential trade arrangements for policy and market access
Journal article   Peer reviewed

Implications of preferential trade arrangements for policy and market access

The Canadian journal of economics, v 29(2), pp S401-S405
01 Apr 1996

Abstract

Common markets Economic models Economic theory International economic relations International trade Market entry Oligopoly Regionalism Studies Trade policy
The ability of outside countries to access markets of regionally integrated areas (RIAs) is an important practical problem and a key issue in the literature on economic integration. One concern of policy intellectuals is that the dismantling of internal trade controls may cause harmful trade inversion. Another concern is that the formation of trading blocs, the deepening of integration in existing RIAs, or increases in their size may raise incentives to adopt more restrictive policies on trade with the rest of the world. Recent theoretical work in perfectly competitive settings provides support for these points. Since a large portion of trade between advanced economies is of the intra-industry kind which often takes place in imperfectly competitive markets, the question arises as to whether these findings generalize. A 2nd question is whether the form of integration considered matters. These issues are addressed with the help of the oligopoly model considered in Syropoulos (1994).

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