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Why Do Countries Pursue Reciprocal Trade Agreements? A Case Study of North America

  • Michael A. Kouparitsas
Part of the Advances in Spatial Science book series (ADVSPATIAL)

Abstract

Despite the considerable effort that has been directed to global trade agreements, such as the General Agreement on Tariffs and Trade, much of the trade liberalization achieved in the postwar era has in fact come from far-reaching reciprocal regional trade agreements that have involved just a few players. Early regional trade pacts, such as the European Union (EU), involved countries of roughly equal size, while the trend over the last decade has been for regional agreements that bring together one or more small countries and a large country or an established free-trade zone.1,2 This trend has captured the attention of trade theorists because while trade theory argues that the best course of action for large countries may be reciprocal trade agreements, it also argues that the best course of action for a small country is always unilateral trade liberalization.3

Keywords

Gross Domestic Product Trade Agreement Trade Liberalization Intermediate Good North American Free Trade Agreement 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer-Verlag Berlin Heidelberg 2002

Authors and Affiliations

  • Michael A. Kouparitsas
    • 1
  1. 1.Federal Reserve Bank of ChicagoChicagoUSA

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