Regional Trade Agreements and Global Trade Liberalization

Annotated Bibliography

Hoekstra, R., & Koopmann, G. (2012). Aid for trade and the liberalization of trade. Journal of World Trade, 46(2), 327-366. Retrieved from http://search.proquest.com/docview/1034566260?accountid=1611

This comprehensive journal mainly focuses on the political theories of the international trade economy between large-scale and small-scale exporting enterprises. Through comprehensive research, the document provides the most recent trade preferential agreements to compare the two dimensions. The paper explores the extent and the mode at which each enterprise has control in the global market. It facilitates the understanding of the global economic growth that has appeared to be a challenge to both the developing and underdeveloped nations. It finally analyzes the reasons for the provision of liberalization and protectionism.

Hicks, R., & Kim, S. Y. (2012). Reciprocal trade agreements in Asia: Credible commitment to trade liberalization or paper tigers? Journal of East Asian Studies, 12(1), 1-29,159-160. Retrieved from http://search.proquest.com/docview/957719897?accountid=1611

The author through his elaborate research studies advocates for regionalism as the best model for trade. Most of the studies presented in the book are from different scientific, social, and economic perspectives. The journal is elaborate and considered as the benchmark for economic simulation and referral to many social scientists as the author embraces the topic with a high profile.

Jeff, M. (2013). Services trade liberalization at the regional level: Does southern and eastern Africa stand to gain from economic partnership agreement negotiations? Journal of World Trade, 41(2), 411-450. Retrieved from http://search.proquest.com/docview/217549017?accountid=1611

This paper mainly analyses the possible pros and cons that the south and Eastern African countries will achieve as a result of integrating into the Economic Partnership Agreement. The article through a comprehensive analysis and research provides the latest development trends in these nations that will enable these countries to archive the agreement. These factors include business services, financial services, and reliable human resources that will enable the mode to flow.

Liu, X. (2010). Testing conflicting political economy theories: Full-fledged versus partial-scope regional trade agreements. Southern Economic Journal, 77(1), 78-103. Retrieved from http://search.proquest.com/docview/607250596?accountid=1611

Liu in his work provides an empirical analysis to test the conflicting issues of the regional trade agreement (liberalization formation to protectionism (capitalism). In the results, the author discovers that the majority of the nations have full-fledged support for liberalization. He advocates that developed nations should lower the trade tariffs in order to encourage the developing nations to join them as partners in trade. These non-discriminatory trade mechanisms will make nations achieve the Most Favored Nation Clause.

Persin, D. (2011). Market access for small versus large service enterprises: The preferential and multilateral trade liberalization tracks compared. Journal of World Trade, 45(4), 785-819. Retrieved from http://search.proquest.com/docview/902122073?accountid=1611

Persin in his journal comprehensively covers the consequences of nations operating in a liberalized market or in protectionism. The well-developed journal bases its argument on time-series evidence of the performance of various nations across the globe using the two dimensions. In his analysis, he portrays that countries that use liberalization always achieve better economies but are limited in protectionism forms of trade. The article proves that the benefits of liberalization are the main contributors of globalization and open world economy.

Shakur, S. (2012). Impact of global trade liberalization on regional trade balances. International Journal of Economics and Finance, 4(1), 48-55. Retrieved from http://search.proquest.com/docview/918647352?accountid=1611

This article provides a comprehensive comparison between the Global Trade Liberalization and Regional Trade Agreements in a global scenario. The author employs a dynamic computable equilibrium model to capture the impacts of these PICTA and Economic partnership Agreement on these Islands. The scenario reveals that full liberalization form of trade have enormous benefits to the nations. It shows that regionalism has enormous employment benefits and proper citizens’ welfare. The author of this article advocates for proper policies to maintain such forms of trade.

Sen, R., Srivastava, S., & Pacheco, G. (2013). The early effects of preferential trade agreements on intra-regional trade within ASEAN+6 members. Journal of Southeast Asian Economies, 30(3), 237-249. Retrieved from http://search.proquest.com/docview/1478019004?accountid=1611

This journal mainly analyzes the effects of bilateral and regional Preferential Trade Agreements (PTAs). The study utilizes a well-augmented model referred to as ASEAN to determine the impact of membership in plurilateral and bilateral PTA from the year 1994 to 2006. The results indicate that the plurilateral forms of trade had better gravity compared to the bilateral form, thus, conforming to the pattern of liberalization.

Takeda, S., & Ban, K. (2011). Regional effects of trade liberalization in japan: A CGE analysis based on an interregional input-output table. Rochester: Social Science Research Network. doi:http://dx.doi.org/10.2139/ssrn.1886019

The well-developed book through proper research and case studies from reliable data of 1950-92, estimates the economic performance of different nations in the liberalized trade. The time-sequential analysis of the book portrays that there has been tremendous growth of the economy in many nations since the adoption of the broad liberalization. The results obtained from several empirical studies indicate clearly that global trade is better than regional, as it provides both direct and indirect benefits to the nation.

Regional Trade Agreements and Global Trade Liberalization

Regional trade agreements are free to trade agreements between two or more economies that can benefit the economies in one way or another. This is done by partners with the purpose of creating fair and efficient trading between or among the parties and promoting economic integration and expansion for the people in those economies. However, global trade liberalization includes the removal of obstacles on the free trade of products and services. For instance, removing duties and non-tariff barriers, such as quota. Trade liberalization can benefit any country, regardless of their economic status, since each country is able to produce products that are scarce in other parts of the world using their available resources (Takeda, 2011).

Most nations practice regionalism since it is an easier option, as their great figure of participants in multilateral trade negotiations reduces the cost of non-cooperation and creates rigidity in the trading system. They also believe that trade barriers are more complicated to negotiate in a multilateral system than in a regional system. However, this weakens the opponents of trade liberalization, influencing much of regional trade agreements, which may not be enough in providing some products to boost the economy of a country. This is because there are products that can be made only in other parts of the world; hence, there are possibilities that these countries will have less supply of certain goods to their citizens (Sen, 2013).

Regionalism has become the preferred form of trade by governments in many countries. Governments are usually responsible for trade policies for their countries, and government statements often emphasize the potential ability of the free trade agreements (FTAs), serve as a foundation for development in a country, and do not hinder the World Trade Organization’s ability to achieve multilateral liberalization goals. These forms of agreements usually involve the developed nations as well as the developing nations from all parts of the globe through negotiations by governments. This form of trade has effectively assisted in the multilateral trading system (Shakur, 2012).

In other cases, the WTO supports the RTAs since the members of this organization negotiate favorable trade activities with all their partners and it later creates a better platform for global negotiation (Liu, 2010). However, the RTAs create a limitation for certain countries, that is, in terms of insider-outsider relations, due to their regional agreement. The agreements may have a negative outcome for the outsider countries because of the diversion effects of trade and investment in relation to the agreements (Persin, 2011).

A state has the option of entering a regional deal agreement or a multilateral free trade arrangement, either in cooperation with pro-regionalism or pro-multiculturalism forces. The policy makers’ choice configures and as a supporting equilibrium balances the different forces. In particular, a nation’s choice to go into the regional trade contract will be driven by alterations in the policy-making procedure, the lobbying doings of an organized important group representing business interests, and the degree of trade barriers (Jeff, 2013).

An outstanding feature in the current increase of regionalism is that the nation’s that have been, by tradition, privileged the multilateral approach to trade liberalization – including Australia, Japan, Singapore, India, and the Republic of Korea – have joined the RTA bandwagon (Hoekstra et al, 2012). A different composition of RTAs involving broader nation coverage rather than the traditional regional region has emerged, with RTAs between countries and entities in different regions/continents (e.g. EU–Mexico, EU–South Africa, US–Israel, Jordan, Morocco, and Chile). These arrangements are commonly bilateral in membership, concluded by two countries/entities, including the case of FTAs negotiated and concluded by two distinct RTAs (Hicks, et al, 2012).

References

Hicks, R., & Kim, S. Y. (2012). Reciprocal trade agreements in asia: Credible commitment to trade liberalization or paper tigers? Journal of East Asian Studies, 12(1), 1-29,159-160. Retrieved from http://search.proquest.com/docview/957719897?accountid=1611

Hoekstra, R., & Koopmann, G. (2012). Aid for trade and the liberalization of trade. Journal of World Trade, 46(2), 327-366. Retrieved from http://search.proquest.com/docview/1034566260?accountid=1611

Jeff, M. (2013). Services trade liberalization at the regional level: Does southern and eastern africa stand to gain from economic partnership agreement negotiations? Journal of World Trade, 41(2), 411-450. Retrieved from http://search.proquest.com/docview/217549017?accountid=1611

Liu, X. (2010). Testing conflicting political economy theories: Full-fledged versus partial-scope regional trade agreements. Southern Economic Journal, 77(1), 78-103. Retrieved from http://search.proquest.com/docview/607250596?accountid=1611

Persin, D. (2011). Market access for small versus large service enterprises: The preferential and multilateral trade liberalization tracks compared. Journal of World Trade, 45(4), 785-819. Retrieved from http://search.proquest.com/docview/902122073?accountid=1611

Shakur, S. (2012). Impact of global trade liberalization on regional trade balances. International Journal of Economics and Finance, 4(1), 48-55. Retrieved from http://search.proquest.com/docview/918647352?accountid=1611

Sen, R., Srivastava, S., & Pacheco, G. (2013). The early effects of preferential trade agreements on intra-regional trade within ASEAN+6 members. Journal of Southeast Asian Economies, 30(3), 237-249. Retrieved from http://search.proquest.com/docview/1478019004?accountid=1611

Takeda, S., & Ban, K. (2011). Regional effects of trade liberalization in japan: A CGE analysis based on an interregional input-output table. Rochester: Social Science Research Network. doi:http://dx.doi.org/10.2139/ssrn.1886019