Analytic research in the theory of regional trade agreements has produced a literature with very few general propositions. Not only are results ambiguous, but clear results are only available under very restrictive sets of assumptions. This study develops a technique that is designed to overcome these two difficulties. What we do is to utilise computational techniques to determine the circumstances under which propositions are true. Using a simplified (fewer countries and commodities) CGE model and sampling theory to tell us how many equilibria to compute, we determine the percentage of cases for which a given proposition holds. In this way, by mapping out the set of parameter values for which a result occurs we can get a feel for which statements are generally true and which are not. In addition, when the propositions are not true we will be able to sharpen the intuition for why this is the case. This approach will help reduce the degree of ambiguity of some analytic results and (though still theoretical) end up being of some relevance from a policy perspective.
M. Ayhan Kose and Raymond Riezman, "Small Countries and Preferential Trade Agreements 'How severe is the innocent bystander problem?'", CSGR Working Paper 48/00, January 2000, Abstract, Full Document
Lisandro Abrego and John Whalley, "The Choice of Structural Model in Trade-Wages Decompositions", CSGR Working Paper 34/99, May 1999, Abstract, Full Document
Lisandro Abrego, Carlo Perroni, John Whalley and Randall Wigle, "Trade and Environment: Bargaining Outcomes from Linked Negotiations ", CSGR Working Paper 27/99, April 1999, Abstract, Full Document
Lisandro Abrego, "Trade Liberalization and Foreign Direct Investment: An Applied General Equilibrium Model for Costa Rica", CSGR Working Paper 26/99, April 1999,Abstract, Full Document
M. Ayhan Kose and Raymond Riezman, "Understanding the Welfare Implications of Preferential Trade Agreements", CSGR Working Paper 45/99, October 1999, Abstract, Full Document
Raymond Riezman, "Can Bilateral Trade Agreements Help Induce Free Trade?", CSGR Working Paper 44/99, October 1999, Abstract, Full Document
M. Ayhan Kose and Raymond Riezman, "Trade Shocks and Macroeconomic Fluctuations in Africa", CSGR Working Paper 43/99, October 1999, Abstract, Full Document