Are Free Trade Agreements Contagious?

Baldwin, Richard; Jaimovich, Dany

Download This Paper

Open PDF in Browser

Add Paper to My Library

Are Free Trade Agreements Contagious?

NBER Working Paper No. w16084

35 Pages Posted: 14 Jun 2010 Last revised: 14 Jun 2026

See all articles by Richard Baldwin

Richard Baldwin

IMD; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Dany Jaimovich

Faculty of Economics and Business, University of Talca

There are 2 versions of this paper

Date Written: June 2010

Abstract

This paper presents a new model of the domino effect which is used to generate an empirical index of how "contagious" FTAs are with respect to third nations. We test our contagion hypothesis together with alternative specifications of interdependence and other political, economical and geographical determinants of FTA formation. Our main finding is that contagion is present in our data and is robust to various econometric specifications and samples.

Suggested Citation: Suggested Citation

Baldwin, Richard and Jaimovich, Dany, Are Free Trade Agreements Contagious? (June 2010). NBER Working Paper No. w16084, Available at SSRN: https://ssrn.com/abstract=1624144