Customs unions and special protection

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4 Citations (Scopus)

Abstract

This paper investigates the impact of customs unions (CUs) on the ability of countries to multilaterally cooperate within an economic environment characterized by trade-flow volatility. We find that the initiation of CU talks results in an easing of multilateral trade tensions, especially with regard to the employment of "special"-protection instruments, such as anti-dumping duties or safeguards. However, once the CU agreements come into force, a retreat to a more protectionist trading environment becomes necessary so that multilateral cooperation does not break down. Interestingly, in comparison with the pre-CU world, the utilization of "special"-protection tools in the post-CU world is more severe for "high" import volumes, but is less frequent overall. Moreover, "normal" protection remains low, largely unchanged from the pre-CU era.
Original languageEnglish
Article number107
Number of pages37
JournalB E Journal Of Economic Analysis & Policy
Volume10
Issue number1
DOIs
Publication statusPublished - 1 Jan 2010

Keywords

  • customs unions
  • special protection
  • regional trade agreements
  • multilateral cooperation
  • market power

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