Owing to their low bargaining power and high negotiation costs, microstates face severe disadvantages when dealing with the outside world. Forming a group with neighboring nations might be an effective instrument to address this problem. This paper presents a model in which the decision to form,...

This model shows that a microstate's decision to form, expand, or join a regional organization is based on reduced negotiating costs and increased bargaining power, rather than on the traditional costs and benefits of trade integration. Forming a regional grouping with neighboring nations may be...

Forming a regional grouping with neighboring nations may be one way for microstates to overcome a major problem: Because of their weak bargaining power and high fixed costs of negotiation, microstates are at a severe disadvantage in dealing with the rest of the world. They don't have the human...

This paper provides a different basis than previous analyses for regional bloc formation and regional migration. Due to low bargaining power and fixed costs, small states face a severe disadvantage in negotiations with the rest of the world and might benefit by forming a regional bloc. The study...

This paper examines the impact on total factor productivity in Latin America and the Caribbean (LAC) and in other developing countries of trade-related technology diffusion from the North) (denoted by NRD), education, and governance, research and development The NRD value for a developing...

Schiff considers the policy options of the West Bank and Gaza with respect to trade and the export of labor services. He concludes that: • Nondiscriminatory trade policy is unambiguously superior to a free trade agreement with Israel. • The West Bank and Gaza should pursue a...

May 2000 - Two theories are combined to explain why free trade areas (FTAs) have proliferated more than customs unions (CUs) have, and why FTAs are found more in North-South agreements and CUs in South-South agreements. Schiff combines two theories - one about how multilateral trade...

November 1999 - Social capital raises productivity and falls with labor mobility. Because labor mobility generates a negative externality, integration of labor markets results in too much mobility, too low a level of social capital, and an ambiguous effect on welfare. Trade liberalization is...

August 1999 - Adherents of the natural trading partner hypothesis argue that preferential trade agreements are more likely to improve welfare if participating countries already trade disproportionately with each other. Opponents argue the opposite. Neither side is right. The hypothesis holds up...