Suppose that an opportunity arises for two countries to negotiate a free trade agreement (FTA). Will an FTA between these countries be politically viable? If so, what form will it take? We address these questions using a political economy framework that emphasizes the interaction between...

This paper explores to what extent the magnitude and speed of the contagion effects that materialized in East Asia in the second half of 1997 may have had "real" underpinnings, in the sense that the pattern of production, consumption and trade increased the vulnerability of East Asian countries...

Most countries are members of preferential trade agreements (PTAs). The effect of these agreements has attracted much interest and raised the question of whether PTAs promote or slow down multilateral trade liberalization, i.e. whether they are a ‘building block’ or a ‘stumbling block’...

‘Regulatory protection’ or technical barriers to trade (TBT) are two names for the myriad of cost-raising, behind-the-border measures that substantially inhibit trade. This paper argues that TBTs are important and their liberalization will continue. This liberalization will involve...

This Paper contributes ideas and analysis to the ongoing EU reform debate. It consists of three distinct parts: voting in the Council of Ministers, restructuring the ECB's Governing Council, and the setting of enlargement “examination” dates. The IGC currently focuses on Council voting,...

This paper studies the strategic interaction of Euroland's national macroeconomic players and the ECB council under two alternative assumptions on central bank behavior: (i) all members of the ECB council are concerned about Euroland's macroeconomic aggregates and (ii) the ECB council is...

This paper modifies the heterogenous firms and trade model by Melitz (2003) by explicitly modelling the entry cost of a firm in a new market as a function of market size. This leads to several new predictions compared to the standard model: The productivity of non exporters and exporters depends...

This paper employs worldwide data on output and bilateral trade in order to identify optimum currency areas (OCA’s) on a global basis. By retaining only two of the many criteria that have been mentioned in the literature on OCA’s, it has been possible to use computer programming to do the...

This Paper examines the impact of imported technologies on productivity for a sample of developing and transition countries in Central and Eastern Europe and in the Southern Mediterranean. These economies are getting more and more integrated to the European Union. The Paper departs from earlier...

This Paper develops a model in which the interaction between product market imperfections, transportation costs, unions and workers immobility across regions creates a tendency for agglomeration of firms when transportation costs are low. The model fits quite well the European experience. It is...