Click here for search results
Does Mercosur's trade performance raise concerns about the effects of regional trade arrangements?, Volume 1
 
Author:Yeats, Alexander; Collection Title:Policy, Research working paper ; no. WPS 1729
Country:Mercosur; Date Stored:2001/04/21
Document Date:1997/02/28Document Type:Policy Research Working Paper
SubTopics:Environmental Economics & Policies; Common Carriers Industry; Economic Theory & Research; Trade Policy; Free Trade; Transport and Trade Logistics; Trade and Regional IntegrationLanguage:English
Major Sector:(Historic)Economic PolicyRegion:Latin America & Caribbean
Report Number:WPS1729Sub Sectors:Trade
Volume No:1  

Summary: A concern about regional trade arrangements (RTAs) is whether the discriminatory trade barriers applied to RTAs encourage high-cost imports from member countries at the expense of nonmember lower-cost goods. RTA impact evaluations have been hampered by a lack of appropriate empirical procedures for assessing their influence on trade level and direction. The author employs a new index for analyzing the static trade effects of an RTA. He examines export regional orientation changes combined with the revealed comparative advantage (RCA) index to identify trade pattern inefficiencies. This is applied to Mercosur countries' export statistics to determine if recent trade is evolving compatible with the countries' current comparative advantage. The results show the dynamic products in Mercosur's intra-trade are capital intensive goods which members have not displayed a strong export performance in outside markets. Neither the RCA indices nor factor proportion statistics indicate that Mercosur has a comparative advantage in those products. The evidence suggests Mercosur's trade barriers are responsible for the trade changes. Most favored nation tariffs on the fast growing products are above the average for all imports and provide Mercosur members with significant preferences. These findings constitute evidence on the potential adverse effects of regional trade arrangements on members and on third countries. Given the recent proliferation of RTAs, they highlight the need for further empirical research on the domestic and international effects of these arrangements, to better assess the pros and cons of regionalism.

Official Documents
Official, scanned versions of documents (may include signatures, etc.)
File TypeDescriptionFile Size (mb)
PDF 46 pagesOfficial version*3.22 (approx.)
TextText version**
How To Order
Light-Weight Documents
Lighter (less MB) documents which may or may not be the final, official version
File TypeDescriptionFile Size (mb)
PDF 46 pagesWPS17292.00

* The official version is derived from scanning the final, paper copy of the document and is the official,
archived version including all signatures, charts, etc.
** The text version is the OCR text of the final scanned version and is not an accurate representation of the final text.
It is provided solely to benefit users with slow connectivity.



Permanent URL for this page: http://go.worldbank.org/LYKKEJ0P00