Open Regionalism in the Andean Community: a Trade Flow Analysis

World Trade Review, Vol. 2, No. 1, pp. 101-118

Posted: 3 Aug 2010 Last revised: 20 Feb 2013

See all articles by Germán G. Creamer

Germán G. Creamer

Stevens Institute of Technology, School of Business; Columbia University - Department of Computer Science

Date Written: July 31, 2003

Abstract

This article evaluates the extent to which the establishment of the Andean Free Trade Zone (AFTZ) has led to an improvement of intra-regional trade, as promised by open regionalism, without reducing extra-regional trade. Open regionalism is a dynamic process in which economic agreements serve as intermediate steps towards integration with the world economy. The calculations of ex post income elasticities of import demand show that the establishment of the AFTZ in 1993 led to an increase in Andean Community trade, and not to a contraction of extra-regional trade. The intensity of trade index and the propensity to export intra- and extra-regionally confirm this finding. The article discusses these results in the context of the multilateral trading system and the trade relations between the Andean Community and the rest of the world.

Keywords: economic integration, andean integration, open regionalism

JEL Classification: F13, F14, F15

Suggested Citation

Creamer, Germán G., Open Regionalism in the Andean Community: a Trade Flow Analysis (July 31, 2003). World Trade Review, Vol. 2, No. 1, pp. 101-118. Available at SSRN: https://ssrn.com/abstract=801926

Germán G. Creamer (Contact Author)

Stevens Institute of Technology, School of Business ( email )

1 Castle Point on Hudson
Hoboken, NJ 07030
United States
2012168986 (Phone)

HOME PAGE: http://www.creamer-co.com

Columbia University - Department of Computer Science ( email )

New York, NY 10027
United States

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