Trade Creation and Trade Diversion in the North American Free Trade Agreement: The Case of the Agricultural Sector

Dwi Susanto, C. Rosson and Flynn Adcock

Journal of Agricultural and Applied Economics, 2007, vol. 39, issue 01, 14

Abstract: This paper examines the effect of the U.S.-Mexico trade agreement under the North American Free Trade Agreement (NAFTA). The results suggest that U.S. agricultural imports from Mexico have been responsive to tariff rate reductions applied to Mexican products. A one percentage point decrease in tariff rates is associated with an increase in U.S. agricultural imports from Mexico by 5.31% in the first 6 years of NAFTA and by 2.62% in the last 6 years of NAFTA. U.S. imports from Mexico have also been attributable to the pre-NAFTA tariff rates. Overall, the results indicate that the U.S.-Mexico trade agreement under NAFTA has been trade creating rather than trade diverting.

Keywords: International; Relations/Trade (search for similar items in EconPapers)
Date: 2007
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Citations: View citations in EconPapers (11)

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Related works:
Journal Article: Trade Creation and Trade Diversion in the North American Free Trade Agreement: The Case of the Agricultural Sector (2007)
Working Paper: Trade Creation and Trade Diversion in the North American Free Trade Agreement: The Case of Agricultural Sector (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:joaaec:6618

DOI: 10.22004/ag.econ.6618

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