The US Trade Deficit, the Decline of the WTO and the Rise of Regionalism

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dc.contributor.author AGUR, Itai
dc.date.accessioned 2007-10-03T15:29:19Z
dc.date.available 2007-10-03T15:29:19Z
dc.date.issued 2007
dc.identifier.issn 1725-6704
dc.identifier.uri http://hdl.handle.net/1814/7104
dc.description.abstract This paper argues that the growing US trade deficit has caused the decline of the WTO and the rise of regional trade agreements. A country in de.cit prefers to retain market power against countries with a large surplus. Multilateral cooperation restricts its choice. This notion is formalized in a three-country game in which countries negotiate multilaterally and, if that fails, bilaterally. The multilateral agreement only holds for su¢ ciently even trade balances. When one country's deficit grows too large, a regionalist equilibrium emerges. A VAR analysis shows that the US trade balance explains over 50% of the variation in regional trade agreements. en
dc.language.iso en en
dc.publisher European University Institute
dc.relation.ispartofseries EUI ECO en
dc.relation.ispartofseries 2007/17 en
dc.subject Regionalism en
dc.subject RTA en
dc.subject Multilateralism en
dc.subject WTO en
dc.subject Trade balance en
dc.subject US trade deficit en
dc.subject C72, C73, F13, F32 en
dc.title The US Trade Deficit, the Decline of the WTO and the Rise of Regionalism en
dc.type Working Paper en
dc.neeo.contributor AGUR|Itai|aut|
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