Jump to ContentJump to Main Navigation
Costs and Benefits of Economic Integration in Asia$
Users without a subscription are not able to see the full content.

Robert J. Barro and Jong-Wha Lee

Print publication date: 2011

Print ISBN-13: 9780199753987

Published to Oxford Scholarship Online: September 2011

DOI: 10.1093/acprof:oso/9780199753987.001.0001

Show Summary Details
Page of

PRINTED FROM OXFORD SCHOLARSHIP ONLINE (www.oxfordscholarship.com). (c) Copyright Oxford University Press, 2018. All Rights Reserved. Under the terms of the licence agreement, an individual user may print out a PDF of a single chapter of a monograph in OSO for personal use (for details see www.oxfordscholarship.com/page/privacy-policy).date: 17 January 2019

The ASEAN Free Trade Agreement: Impact on Trade Flows and External Trade Barriers

The ASEAN Free Trade Agreement: Impact on Trade Flows and External Trade Barriers

(p.157) 6 The ASEAN Free Trade Agreement: Impact on Trade Flows and External Trade Barriers
Costs and Benefits of Economic Integration in Asia

Hector Calvo-Pardo

Caroline Freund

Emanuel Ornelas

Oxford University Press

Using detailed data on trade and tariffs from 1992–2007, the chapter examines how the Association of Southeast Asian Nations (ASEAN) Free Trade Agreement has affected trade with nonmembers and external tariffs facing nonmembers. First, the chapter examines the effect of preferential and external tariff reduction on import growth from ASEAN insiders and outsiders across HS 6-digit industries. It finds no evidence that preferential liberalization has led to lower import growth from nonmembers. Second, the chapter examines the relationship between preferential tariff reduction and most-favored-nation (MFN) tariff reduction. It finds that preferential liberalization tends to precede external tariff liberalization. To examine whether this tariff complementarity is a result of simultaneous decision-making, it uses the scheduled future preferential tariff reductions (agreed to in 1992) as instruments for actual preferential tariff changes after the Asia crisis. The results remain unchanged, suggesting that there is a causal relationship between preferential and MFN tariff reduction. The chapter also finds that external liberalization was relatively sharper in the products where preferences are likely to be most damaging, providing further support for a causal effect. Overall, the results imply that the ASEAN agreement has been a force for broader liberalization.

Keywords:   regionalism, external tariffs, trade liberalization, preferential trade agreements, Asia, tariff complementarity, trade diversion, trade creation

Oxford Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.

Please, subscribe or login to access full text content.

If you think you should have access to this title, please contact your librarian.

To troubleshoot, please check our FAQs , and if you can't find the answer there, please contact us .