Why are Trade Agreements Regional?
- Publisher: Milano: Fondazione Eni Enrico Mattei (FEEM)
- Subject: Regionalism | Außenhandelsliberalisierung | Trade Liberalization | Coalition, Coordination, Regionalism, Preferential Trade Agreement, Trade Liberalization | F02 | F13 | F15 | Coordination | Preferential Trade Agreement | Koordination | Optimalzoll | Coalition | Handelsregionalismus | Theorie | C72
- jel: jel:F02 | jel:F13 | jel:C72 | jel:F15ddc: ddc:330
This paper shows how distance may be used to coordinate on a unique equilibrium in which trade agreements are regional. Trade agreement formation is modeled as coalition formation. In a standard trade model with no distance between countries, a familiar problem of coord... View more