The liberalisation of east-west European trade: hubs, spokes and further complications

Article Abstract:

A study describes recent and prospective developments in Europe and examines how the emerging hub-and-spoke system pattern compares to a free trade agreement exclusive to European nations. Focus was on the issue of what the European target should be in terms of trade liberalization. Negotiators who experience short-term distraction because of too much detail, political pressure and Eastern European negotiators aiming to get into the EU without giving much consideration on the terms may benefit from the research effort.

Research, Interpretation and construction, Europe, International economic relations

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Trade and investment in a hub-and-spoke system versus a free trade area

Article Abstract:

A comparison of the economic implications between a free trade agreement (FTA) and a 'hub-and-spoke' (H&S) arrangement among the members of a regional trade bloc was analyzed. This question is important due to the emergence of trade blocs such as the NAFTA and the APEC. It was argued that in an FTA, there will be higher incomes among members due to the absence of trade barriers, while in an H&S, there will be lesser competition, economies of scale and lesser opportunities for comparative advantage.

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Free-trade agreements: for better or worse?

Article Abstract:

The formation and expansion of regional free trade agreements (FTAs) are beneficial to member economies. This may be attributed to the increase in welfare due to trade diversion. However, an increase in the number of FTAs may result to trade problems due to possible overlapping of functions. Cases involving hub-and-spoke systems show the existence of trade barriers that can decrease the income of participating countries.

Analysis, Regional economics

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