articles: Spatial markets and the potential for economic integration between Canadian and U.S. regions

William Brown () and William P. Anderson
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William P. Anderson: Department of Geography, Boston University, 675 Commonwealth Avenue, Boston, MA 02215-1401, USA

Papers in Regional Science, 2002, vol. 81, issue 1, 99-120

Abstract: The potential for further economic integration among Canadian and American regions is measured by comparing province-to-state trade with state-to-state trade, where the latter is used as a benchmark of integration. To accomplish this, an attraction constrained gravity model is derived from micro foundations and estimated. The analysis demonstrates that after controlling for variations in output, distance, wages, productivity, and localization economies, the border remains a significant barrier to trade, although much less than previous estimates of the border effect using internal Canadian trade as a benchmark. The model's results also indicate that the border's influence varies across sectors, and the influence appears to be, in part, related to the presence of tariff and non-tariff barriers.

Keywords: Border effect; gravity model; Canada-U.S. trade (search for similar items in EconPapers)
JEL-codes: C51 F14 R11 R12 (search for similar items in EconPapers)
Date: 2002-02-07
Note: Received: 1 February 1999
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Citations: View citations in EconPapers (22)

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