Geographical Extension of Free Trade Zones as Trade Liberalization: A Numerical Simulation Approach

Topics:
Tariffs
Tags:
Finance,
Free Trade,
Liberalization,
Tariff
Source:
CESifo Group

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Overview: This article considers progressive geographical expansion of free trade zones within countries as a form of trade liberalization and compares observationally equivalent liberalization involving changes in the coverage of a free trade zone for a fixed tariff rate, and tariff reductions applying to all trade if there are no free trade zones in the country (in the sense of generating similar changes in trade volumes). It uses numerical simulation methods to compare conventional national tariff reductions to trade liberalization achieved through the geographical expansion of free trade zones in terms of welfare impacts.

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Format: PDF | Size: 547KB | Date: Mar 2004 | Pages: 30

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