Table of Contents

Economic Regionalization in the Asia-pacific

Economic Regionalization in the Asia-pacific

Challenges to Economic Cooperation

M. Dutta

This original and comprehensive book provides a unique insight into the development of economic regionalization, with special reference to the Asia-Pacific. It presents international globalization strategies from a historical perspective and then analyses the effects on the development of Asia-Pacific Economic Cooperation (APEC). Focusing on APEC itself, the author provides a detailed investigation into its organization and agenda, and thorough personal interviews with some of the most influential people who have worked for APEC.

Chapter 4: Economic Regionalization in Western Europe: Search for a New Paradigm

M. Dutta

Subjects: asian studies, asian economics, economics and finance, asian economics, international economics

Extract

Page 32  4  Economic Regionalization in Western Europe: Search for a New Paradigm  BEYOND A CUSTOMS UNION/A FREE TRADE AREA  Jacob Viner’s pioneering work, The Customs Union Issue (1950) remains the classic treatise on economic regionalization. Removal of trade barriers, Viner argued,  would add to the flow of trade among trading countries. In addition, free flow of trade would contribute to competitive price rationalization in all trading economies,  much to the gain of consumers in all countries.  No economic principle ever works without qualification. The question has been raised whether Viner failed to adjust his simple model of customs union for “trade  diversion” (Schott 1989a, pp. 1–50), and/or for “trade repression” à la Stolper­Samuelson Condition (Park and Yoo, 1989, pp. 143–4).  Notwithstanding the fact that a customs union and a free trade area are not identical expressions of multinational regional grouping, Viner’s thesis on customs union has  been the core economic rationale for FTAs, and its critiques question whether they are basically superior to GATT (Wonnacott and Lutz 1989) and WTO as of 1995,  except for the fact that the pace of negotiation in an FTA may be relatively fast, as it generally involves “like­minded” peoples/countries (Canada­U.S. FTA, U.S.­ Israel FTA).  A bilateral FTA, irrespective of the fact of “like­mindedness” of the two parties to the agreement, is certainly not comparable to GATT negotiations where negotiations  among its 150­plus sovereign member­states have been known to be painfully slow. Illuminating discourses on bilateral FTAs,...

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