Based on static analysis, a number of studies argue that forming a regional trade agreement (RTA) is more likely to raise welfare if member countries are ?natural trading partners,? while other studies claim the opposite. This paper considers the argument from a dynamic viewpoint by examining...

Based on static analysis, a number of studies argue that forming a regional trade agreement RTA is more likely to raise welfare if member countries are ?natural trading partners,? while other studies claim the opposite. This paper considers the argument from a dynamic viewpoint by examining the...