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12 - The Contribution of Productivity Linkages to the General Equilibrium Analysis of Free Trade Agreements

Published online by Cambridge University Press:  05 June 2012

Ken Itakura
Purdue University, USA
Thomas W. Hertel
Purdue University, USA
Jeffrey J. Reimer
University of Wisconsin, USA
Elena Ianchovichina
The World Bank, Washington, DC
Terrie L. Walmsley
Purdue University, Indiana
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Despite the economic arguments in favor of conducting trade negotiations multilaterally under the auspices of the WTO, there have been more than 100 regional trade agreements signed since the WTO was created in 1995 (WTO 2002). The European Union, for example, signed regional trade agreements with 20 nations between 1991 and 2001 –most of them developing countries (WTO 2002). Not to be left out, the United States continues to explore the possibility of extending NAFTA further to the south, with a free trade agreement (FTA) of the Americas as the ultimate goal. A free trade agreement between the United States and Chile was concluded in 2003, and discussions are under way with other nations. The boom in regional agreements has also spread to East Asia. For example, officials from ASEAN and China have endorsed the concept of a free trade agreement between those two regions. Japan, long a staunch advocate of multilateralism, concluded an FTA with Singapore in 2001 (see Chapter 9) and has also been involved in active negotiations with other countries, including Mexico (signed in 2004), ASEAN (signed in 2008), Korea, and China.

Alongside this surge in interest in FTAs has been a corresponding increase in the number of quantitative analyses of such agreements, most of which employ AGE models.

Publisher: Cambridge University Press
Print publication year: 2012

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