The Formation of Global Free Trade Agreement

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Tác giả: Akira Okada, Yasuhiro Shirata

Ngôn ngữ: eng

Ký hiệu phân loại: 337.1 Multilateral economic cooperation

Thông tin xuất bản: 2021

Mô tả vật lý:

Bộ sưu tập: Báo, Tạp chí

ID: 166630

Comment: comments: typos corrected in abstractWe investigate the formation of Free Trade Agreement (FTA) in a competing importers framework with $n$ countries. We show that (i) FTA formation causes a negative externality to non-participants, (ii) a non-participant is willing to join an FTA, and (iii) new participation may decrease the welfare of incumbent participants. A unique subgame perfect equilibrium of a sequential FTA formation game does not achieve global free trade under an open-access rule where a new applicant needs consent of members for accession, currently employed by many open regionalism agreements including APEC. We further show that global FTA is a unique subgame perfect equilibrium under an open-access rule without consent.
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