ch09regional trading arrangements(国际经济学浙江林学院,岑丽娟)

1、International EconomicsBy Robert J. Carbaugh8th EditionChapter 9:Regional Trading ArrangementsRegional trade agreementsTypes of regional trade arrangementsFree trade areas (NAFTA, for example)Customs unions (Benelux)Common markets (EU)Economic/monetary union2Regional trade agreementsEffects of regio

2、nal trade agreementsStatic effectsTrade creation effect (consumption effect, production effect)Trade diversion effectDynamic effectsEconomies of scaleGreater competitionInvestment stimulus3Static effects of a customs unionRegional trade agreements4Regional trade agreements: case studiesThe European

3、UnionCreated by the Treaty of Rome (1957)Policy aims included:Abolition of tariffs, quotas and other restrictionsCommon external tariffFree movement of capital, labor and businessCommon policies on transport, agriculture, and competition and business conductCoordination of monetary and fiscal polici

4、es5Regional trade agreements: case studiesThe European Union (contd)Lowering of barriers caused within-region trade to grow much more quickly than overall world trade in the 1960sSteps to remove remaining barriers (1985-92) further increased integrationMaastricht Summit (1991) began process of econo

5、mic and monetary union (EMU)6Regional trade agreements: case studiesEU Economic & Monetary Union (1999)Member nations will replace national currencies with the euro by 2002New European Central Bank created to control monetary and exchange rate policy“Convergence criteria” required for membership:Pri

6、ce stabilityLow long-term interest ratesStable exchange ratesSound public finances7Regional trade agreements: case studiesOther key EU policiesCommon agricultural policySupport payments to farmersVariable import leviesExport subsidiesGovernment procurement policiesAll EU businesses can bid for large

7、r contracts in any nation8CAP: variable levies and export subsidiesRegional trade agreements: case studies9Opening up government procurementRegional trade agreements: case studies10Regional trade agreements: case studiesCosts & benefits of EMUEurope does not meet all the requirements of a theoretica

8、l optimal currency areaAdvantages of EMU - real but small:Lower transaction costsPrice comparisons easierExchange rate risk eliminatedStimulates competition11Regional trade agreements: case studiesCosts & benefits of EMU (contd)Disadvantages of EMU:Loss of monetary policy and the exchange rates as e

9、conomic adjustment toolsUse of fiscal policy for adjustment is also constrainedAdjustment to shocks therefore depends on wage flexibility and labor mobility, which are both low in Europe12Regional trade agreements: case studiesUS-Canada Free Trade Agmt. (1989)Elimination of all tariffs and most NTBs

10、 over ten yearsBinational tribunal created to hear trade disputesCanada, in particular, is expected to benefit from economies of scale13Regional trade agreements: case studiesNorth American Free Trade Agmt. (1994)Gradual and comprehensive elimination of trade barriers among US, Mexico and Canada ove

11、r 15 years:Full, phased elimination of import tariffsElimination of most NTBsProtection of intellectual property rightsDispute settlement proceduresSide agreements on environmental protection and labor law14Regional trade agreements: case studiesNAFTAs benefitsMexico stood to gain the most, with acc

12、ess to large industrial markets and new inward investment flowsCanada maintained its preferences in the US market and hoped for future access to South American marketsUS stood to gain from access to the Mexican Market and cheap labor and parts, access to reliable oil supplies, and less immigration p

13、ressure; but the benefits were modest15Regional trade agreements: case studiesConcerns about NAFTAMain US losers from NAFTA would be import-protected industries competing with Mexican producers, and unskilled workersUS industrial workers also worried about lower pay scale in Mexico and plant relocat

14、ionsConcerns Mexico would not enforce environmental protection measuresSide agreements on environment and labor law were concluded to address those concerns16Regional trade agreements: case studiesNAFTA after five yearsTrilateral trade increased significantlySome US jobs were lost to Mexico, but the

15、 numbers were small compared to job creation that came with US growthChanges in investment flows were small (in relation to total US foreign investment)Closer political ties were built among the three nations17Regional trade agreements: case studiesSpecial case: economies in transitionNations of eas

16、tern Europe and the former Soviet Union have been making a transition from a non-market (planned) economy to a market economy since the early 1990s - which has been very disruptiveThese nations planned economies required them to be largely isolated from world trade - instead, set up their own tradin

17、g bloc, the Council for Mutual Economic Assistance (CMEA)18Regional trade agreements: case studiesEconomies in transition (contd)Even after the collapse of the central planning system, the nations remained tied together because of historical trade links inside CMEA and their common legacy as non-mar

18、ket economiesFinancing limitations have hampered an increase in trade: transition nations have generally not been able to increase exports to match imports and must borrow the difference19Regional trade agreements: case studiesEconomies in transition (contd)Barriers to trade with the West used to make strategie