Border Effects in an Enlarged EU Area : Evidence from Imports to CEECs Countries

By looking at imports of Eastern European countries we provide novel insights on the importance and magnitude of border effects and on how they are linked with technical barriers to trade. All CEECs traded with themselves more than with other countries. We grouped products into three categories; depending on the importance of applicable technical barriers. Our results show that border effects are the largest for products where we expect to have the most important technical barriers indicating that technical barriers contribute to border effects. We assess if border effects changed over the transition period and we find that for products where technical barriers are less important the magnitude of border effects was declining at the end of the 90s