The Role of Association Agreements within European Union Enlargement to Central and Eastern European Countries

Christophe Rault, Robert Sova () and Anamaria Sova

No 2769, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: The main goal of regionalization is the creation of free trade areas and the guarantee for countries to accede to a widened market. Many studies dealing with the effects of regional free trade agreements on trade flows already exist in the economic literature and the explosion in the number of regional agreements among countries has recently stressed the key role of regionalization. However, the effects of agreements on trade were sometimes contradictory in those studies. These diverging results can be explained by the potential endogeneity bias of the agreement variable. Our research in this paper aims at reassessing the genuine role of associations. For this matter, we particularly study the association of Central and Eastern European countries (CEEC) with European Union countries. Our econometric analysis based on qualitative choice models highlights in particular why European countries chose to conclude an association agreement with CEEC, and stresses the fact that European Union countries select endogenously the conclusion of association agreements. We are also particularly interested in modeling the effect of the association agreement on export performances between countries, and to quantify its impact. When considering annual data for 4 CEEC and 19 OECD countries (1990-2004), we find a 0.17 positive impact of the association agreement on bilateral exports.

Keywords: European integration; gravity model; regionalization; qualitative choice models (search for similar items in EconPapers)
JEL-codes: C25 E61 F13 F15 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2007-04
New Economics Papers: this item is included in nep-dcm, nep-eec and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published - published in: Aussenwirtschaft : Schweizerische Zeitschrift für internationale Wirtschaftsbeziehungen /Swiss Review of International Economic Relations, 2008, Issue III

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Journal Article: The Role of Association Agreements within European Union Enlargement to Central and Eastern European Countries (2008)
Working Paper: The Role of Association Agreements within European Union Enlargement to Central and Eastern European Countries (2008)
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