Using a sample of 15 OECD countries, this paper investigates whether free trade agreements (FTAs) enhance R&D spillovers across national borders and if institutions play some role in affecting this knowledge diffusion process. Dynamic panel regressions employing advanced estimation technique...

This paper proposes a within estimator for three-level data, such as time-variant bilateral trade flows. The estimator helps to address the computational difficulties in estimating, for instance, the gravity model of bilateral trade that needs to control for unobserved country-pair and...

Despite recent theoretical literature highlighting the cross effects between preferential trade agreements (PTAs), like the domino effect and the competitive liberalization theory, little has been done to quantify their impact on bilateral trade flows. This paper investigates how preexisting...

Using recent extensive data of bilateral trade in manufacturing, we study the relations between trade flows, each country’s technological levels, and geographic barriers. Then, we calibrate the equilibrium of a general equilibrium model to explore how a Trans-Pacific Partnership affects...

This paper studies the effects of Trans-Pacific Partnership (TPP) on trade flows and welfare in a general equilibrium framework following the Eaton and Kortum (2002) model. Using comprehensive data including prices, wages, output, and bilateral trade in manufacturing for 38 countries including...

Since Rose’s (2004) striking finding of negligible WTO trade effects, numerous studies have at- tempted to solve the so-called WTO puzzle. These studies adopt novel model specifications to control for potential sources of bias, but often lead to conflicting results. Multilateral...

This paper studies the welfare effects of a preferential trade agreement (PTA) within a general equilibrium framework following Eaton and Kortum (2002) and conducts a comparative statics analysis of the equilibrium. The paper provides a closed-form analysis with no assumption of balanced trade...

This paper empirically examines whether and how similarity in country characteristics affects the changes in trade flows amongst member countries under a preferential trade agreement (PTA). It demonstrates that accounting for similarity in size, income and loca- tion of member countries is...

Conventional estimate of the trade diversion (TD) effect of preferential trade agreements (PTAs) tends to be much smaller than that of the trade creation (TC) effect. This paper ex- amines two sources of estimation bias of the TD effect. The first bias of TD arises from the difficulty in...

The empirical trade literature has long been puzzled by the finding of a large and non-decreasing distance coefficient in the gravity equation amid falling transportation costs over time. To shed new light on this puzzle, the recent theoretical literature shifts its focus to the differential...