A BEJEAP Contributions article.

Abstract

This paper provides one of the first assessments of the hypothesis that two countries are more likely to form a preferential trade agreement (PTA) if they are already major trading partners. The paper also tests a number of predictions from the political economy literature about which countries are expected to form regional agreements. The results show that countries are more likely to be preferential trading partners if they have significant bilateral trade, are similar in size, and are both democracies. Finally, the paper measures the effect of preferential agreements on trade volumes while, unlike previous studies, treating PTA formation as endogenous.

Submitted: June 11, 2003 · Accepted: December 1, 2003 · Published: December 10, 2003

Originally published in Contributions to Economic Analysis & Policy.

Recommended Citation

Magee, Christopher S. (2003) "Endogenous Preferential Trade Agreements: An Empirical Analysis," Contributions to Economic Analysis & Policy: Vol. 2 : Iss. 1, Article 15.
Available at: http://www.bepress.com/bejeap/contributions/vol2/iss1/art15

Related Files

magee_rta.dta (2794 kB)
STATA file with data labels