Do South-South Trade Agreements Increase Trade? Commodity-Level Evidence from COMESA

37 Pages Posted: 4 Mar 2007  

Anna Maria Mayda

Georgetown University - Department of Economics; IZA Institute of Labor Economics

Chad Steinberg

International Monetary Fund (IMF)

Multiple version iconThere are 3 versions of this paper

Date Written: February 2007

Abstract

South-South trade agreements are proliferating: Developing countries signed 70 new agreements between 1990 and 2003. Yet the impact of these agreements is largely unknown. This paper focuses on the static effects of South-South preferential trade agreements stemming from changes in trade patterns. Specifically, it estimates the impact of the Common Market for Eastern and Southern Africa (COMESA) on Uganda's imports between 1994 and 2003. Detailed import and tariff data at the 6-digit harmonized system level are used for more than 1,000 commodities. Based on a difference-in-difference estimation strategy, the paper finds that - in contrast to evidence from aggregate statistics - COMESA's preferential tariff liberalization has not considerably increased Uganda's trade with member countries, on average across sectors. The effect, however, is heterogeneous across sectors. Finally, the paper finds no evidence of trade-diversion effects.

Keywords: International trade agreements, Uganda, Imports, Commodities, Developing countries, Common Market for Eastern and Southern Africa, Trade models

JEL Classification: F13, F14, F15, O24

Suggested Citation

Mayda, Anna Maria and Steinberg, Chad, Do South-South Trade Agreements Increase Trade? Commodity-Level Evidence from COMESA (February 2007). IMF Working Papers, Vol. , pp. 1-35, 2007. Available at SSRN: https://ssrn.com/abstract=967881

Anna Maria Mayda (Contact Author)

Georgetown University - Department of Economics ( email )

Washington, DC 20057
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Chad Steinberg

International Monetary Fund (IMF) ( email )

700 19th Street N.W.
Washington, DC 20431
United States

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