Toward a North American Security Perimeter? Assessing the trade, FDI, and welfare impacts of liberalizing 9/11 security measures

Patrick Georges and Marcel Mérette

Economic Modelling, 2012, vol. 29, issue 6, 2514-2526

Abstract: This paper examines the trade, FDI, and welfare impacts of (liberalizing) 9/11 security measures at the Canada–US border. First, the study provides econometric estimates of the impact of post 9/11 security measures on bilateral (US–Canada) trade flows. Second, we compute sectoral tariff rates “equivalent” to the 9/11 security measures using these econometric estimates together with a three-region nine-sector general equilibrium model. Finally, we assess for both the Canadian and the US economies: 1) the (general equilibrium) impacts on trade, FDI, and welfare, of (liberalising) the 9/11 US security measures and 2) the economic impacts of a change of security paradigm toward a North American Security Perimeter within a Customs Union that would liberalize the Canadian and US 9/11 security measures at the Canada–US border and shift them at the external security perimeter.

Keywords: North American Security Perimeter; Foreign Direct Investment; Customs Union; General Equilibrium Modelling; Gravity Model (search for similar items in EconPapers)
JEL-codes: C2 C6 F1 F2 F5 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:29:y:2012:i:6:p:2514-2526

DOI: 10.1016/j.econmod.2012.08.005

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