A Decomposition of North American Trade Growth since NAFTA

Russell Hillberry () and Christine McDaniel
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Christine McDaniel: USITC

International Trade from EconWPA

Abstract: Total U.S. trade with NAFTA partners has increased 78 percent in real terms since 1993-U.S. Mexico trade alone is up 141 percent-compared to a 43 percent increase in U.S. trade with the rest of the world. In this article we compare the nature of U.S. trade growth with Canada and Mexico to growth in U.S. trade with non NAFTA partners. We apply a simple decomposition of trade growth offered by Hummels and Klenow (2002) that provides insights into whether the United States is trading more of the same goods with NAFTA partners since 1993, or trading new products. The results provide evidence of both. A sizeable component of U.S. trade growth since 1993 can be explained by increases in the variety of products the U.S. imports from Mexico.

Keywords: NAFTA; International Trade (search for similar items in EconPapers)
JEL-codes: F1 F2 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mac
Date: 2003-03-27
Note: Type of Document - PDF; pages: 9; figures: included
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