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Open Economies Review

, Volume 23, Issue 5, pp 869–889 | Cite as

Preferential Trade Agreements and the Margins of Imports

  • Neil Foster
RESEARCH ARTICLE

Abstract

This paper considers the importance of Preferential Trade Agreements (PTAs) in enhancing trade for a large sample of countries within the period 1962–2000. The paper builds upon the existing literature by examining whether any significant effects of PTAs occur through a change in the variety of imports (i.e. the extensive margin) or through a change in the volume of existing products (the intensive margin). Our results indicate that imports respond positively to the formation of a PTA between countries, and that much of this increase in imports occurs along the extensive margin.

Keywords

Preferential trade agreements Intensive and extensive margin Gravity model 

JEL

F10 F15 

Notes

Acknowledgement

The author would like to thank three anonymous referees and the editor, George Tavlas, for helpful comments. Any remaining errors remain the responsibility of the author.

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Copyright information

© Springer Science+Business Media, LLC 2011

Authors and Affiliations

  1. 1.The Vienna Institute for International Economic Studies—wiiwViennaAustria

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