Regional integration and development / Maurice Schiff and L. Alan Winters.

Format:

Book

Government document

Author/Creator:

Schiff, Maurice W.

Contributor:

Winters, L. Alan.

Language:

English

Subjects (All):

Trade blocs.

Regionalism.

Commercial policy.

Free trade.

International economic relations.

Physical Description:

xvii, 321 pages : illustrations ; 23 cm

Place of Publication:

Washington, DC : World Bank ; [Place of publication not identified] : Oxford University Press, [2003]

Summary:

Regional Integration and Development examines regionalism from the perspective of developing countries and presents a comprehensive account of existing theory and empirical results. This book incorporates the findings of formal analyses of the politics and dynamics of regionalism. It considers the relationship between regionalism and multilateralism and explores the economic advantages of nondiscriminatory trade liberalization, which the authors argue should be exploited to the maximum extent. The book also provides rules of thumb for regionalism, rules that are not inviolable but which should not be violated lightly. Designed as a practical guide for policymakers whose countries are considering membership in a trade bloc, this book will also be of interest to scholars and students of international trade.

Contents:

Chapter 1. Regional Integration Agreements: An Overview 1

RIAs in History 4

Why Regionalism? 6

Regionalism as Trade Policy

Making the Most of Regionalism

Regionalism and Investment

Growth and Location

Integration of Domestic Policies

Regionalism as Politics

Regionalism and the Rest of the World

Rules of Thumb for Regionalism

Appendix. Selected Regional Integration Agreements with Developing Country Members 26

Chapter 2. How Trade Blocs Increase Trade and Competition 31

Increased Trade between Members of Trade Blocs 32

Is More Trade Good, or Bad? Trade Creation and Trade Diversion 33

Growth of Trade over Time 36

Not All Changes Come from Regionalism 40

A Change of Perspective: Imperfectly Competitive Markets 46

Larger Markets, More Competition 50

Appendix. The Simple Analytics of Trade Creation and Trade Diversion 54

Chapter 3. Making the Most of Regional Integration 63

Free Trade with Whom? 64

Why Not with Everyone?

Choosing Partners: The "Natural Trading Partners" Fallacy

Choosing Partners: Comparative Advantage

Neighborhood RIAs

North-South or South-South RIAs

How Many RIAs? 75

Free Trade Areas and Customs Unions 78

Trade Deflection and Rules of Origin: More Protection

Indirect Trade Deflection: Exporting Protection

Customs Unions Offer Lower Trading Costs and Greater Integration

External Trade Policy 82

Setting External Tariffs in an FTA: A Race to the Bottom?

Trade Policy Institutions in Customs Unions Can Increase Protection

Lobbies Bias RIAs toward Trade Diversion

RIAs Open a New Environment for Lobbying

RIAs and Protection: Summing Up

Integration and Taxes 94

Fiscal Compensation

Tax Competition

Chapter 4. Stimulating Investment 101

Investment Policies 103

Investment Planning: A Dead End

Bilateral Investment Treaties

Treatment of Investment in Current Regional Arrangements

Multilateral Investment Agreements

Integration as an Aid to Credibility

Not an Automatic Effect 107

RIAs Allow Bad Policy to Be Punished

RIAs Can Affect the Incentives for Good Policies

RIAs Can Signal Government's Reform Intentions

If Genuine

Regional versus Multilateral Routes to Credibility

RIAs as Investment Stimuli 113

Integration Affects Incentives to Invest

Investment Does Not Necessarily Mean Growth in RIAs

Regional Integration and Foreign Direct Investment 117

Motives for FDI

Evidence of the Positive Effects of Integration

Chapter 5. Growth and Location 123

South-South and North-South Regionalism as Stimulants to Growth 124

Knowledge and Institutions as Keys

Trade, Convergence, and Spillovers

Choosing the Wrong Partners Can Harm Growth

FDI and Knowledge Spillovers

Cross-Country Evidence on Openness and Growth

Agglomeration and Industrialization 137

The Balance between Centripetal and Centrifugal Forces

Trade Liberalization Can Aid Industrialization

Intermember Distribution: Divergence Is Likely in South-South RIAS

Chapter 6. Integrating Domestic Policies 147

Defining Policy Integration 149

The Baseline: National Treatment

Beyond National Treatment: Policy Integration

Modes of Policy Integration: Coordination, Harmonization, and Recognition

The Economics of Policy Integration 154

Transactions Costs

Policy Integration to Increase Competition

Spillovers

Compensation and Enforcement

Local versus Regional versus Global Cooperation

Policy Integration to Date: More Promise Than Reality 174

Coverage

Depth of Integration: A Function of Political Objective

Prospects for Policy Integration in RIAs

Chapter 7. Regional Integration as Politics 187

Regional Integration as a Means of Reducing Frictions between Antagonistic Neighbors 188

Trade as a Promoter of Peace

RIAs as Promoters of Peace

RIAs Are Not Always Effective Routes to Peace

RIAs and Social and Political Pressures: Potentially Helpful, but Not a Panacea 196

The Role of Regional Integration in Strengthening Democracy and Political Institutions 198

Regionalism and the Nation-State 201

Regional Integration to Deal with Outside Threats and Regional Hegemons

Regional Integration and Negotiations with the Outside World

Chapter 8. Trade Blocs and the Rest of the World 209

Trade Discrimination: Still Significant 210

Trade Diversion and Excluded Countries 212

Evidence of Trade Diversion

Loss of Exports to Trade Diversion

The Effect of Large RIAs on Nonmembers' Terms of Trade

The Road to Multilateralism: Are RIAs Stepping Stones, or Millstones? 221

Multilateralism as a Process

Negotiating Power of RIAs

Regionalism and Tariff Levels

Has Regionalism Spurred Multilateral Negotiations?

Domino Regionalism

Regionalism as Insurance

RIAs as Negotiating Partners: Do They Promote Free Trade?

Do RIAs Make It Easier to Tackle Tough Issues?

Open Regionalism: Little More Than a Slogan

Regionalism and the WTO 244

GATT, and All That

The Rules for RIAs: Useful, but Not Infallible

Proposals for Improving the Rules on RIAs: "Feasible" and "Desirable" Do Not Overlap

Conclusion: Rules Are Not the Answer

Chapter 9. Rules of Thumb for Regionalism 261

Annex. Selected WTO Provisions on Regional Integration Arrangements 267.

Notes:

Includes bibliographical references (pages 271-297) and index.

ISBN:

0821350781

OCLC:

50227720