Affiliation:
1. Department of Law, Business and Economics University of Bayreuth Bayreuth Germany
2. Centre d'Etudes Prospectives et d'Informations Internationales (CEPII) Paris France
3. ifo Institute and CESifo Research Network Munich Germany
4. Nottingham Centre for Research on Globalisation and Economic Policy (GEP) Nottingham UK
5. School of Economics Drexel University Philadelphia Pennsylvania USA
Abstract
AbstractStarting with Tinbergen (1962, Shaping the world economy: Suggestions for an international economic policy, The Twentieth Century Fund), quantifying the effects of regional trade agreements (RTAs) on international trade flows has always been among the most popular topics in the trade literature. Also not surprisingly, to estimate the effects of RTAs, most researchers and policy analysts have relied on the workhorse model of trade—the gravity equation. Over the past 60 years, there have been many important developments in the RTA literature, both in terms of better methods to quantify their effects, and in terms of more and higher quality data. The objective of this paper is to trace the evolution of the methods and data developments in the RTA literature, from Tinbergen's very first exploration until today, and to critically evaluate their significance for our ability to measure the impact of RTAs (and other policies) on international trade.