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GTAP Resources: Resource Display

GTAP Resource #4548

"Shifting Armington trade preferences: A re-examination of the Mercosur–EU negotiations"
by Philippidis, George, Helena Resano and Ana Isabel Sanjuan Lopez


Abstract
This paper examines the ‘small share’ problem inherent within the constant elasticity of substitution Armington specification. As a de facto research tool in the quantitative trade literature, this structural bias plagues the results of numerous multi-region CGE studies. Kuiper and van Tongeren (2006) proposed a fusion of gravity and CGE specifications to remedy said bias, which the current paper further develops. With a pervasiveness of ‘smallshare’ examples on Mercosur–European Union trade owing to the latter's restrictive tariff regime, the results reveal that significant additional trade led gains to Mercosur under a potential preferential trade agreement when compared with the standard Armington treatment.


Resource Details (Export Citation) GTAP Keywords
Category: Econometric Application
Status: Published
By/In: Economic Modelling 2014 v40, pp21-32
Date: 2014
Version:
Created: Philippidis, G. (4/30/2014)
Updated: Batta, G. (5/11/2014)
Visits: 684
- Baseline development
- Preferential trading arrangements
- South America


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