Trade-diversion effects of free trade agreements (FTAs) have not been thoroughly examined empirically. Using a novel empirical approach, we confirm that FTAs divert trade away from non-member countries and even more so from internal trade (domestic sales) in member countries.

I estimate simultaneous games with incomplete information where players' private information are median-independent of states. I show index coefficients in utility functions are point-identified under exclusion restrictions and weak conditions on the support of states, and propose a consistent...