Regionalism and trade liberalization

My dissertation explores the impact of regionalism on the multilateral process of trade liberalization. The first two chapters examine how the impact of regionalism changes through time. This is done by using non-stationary dynamic models of trade liberalization. Trade liberalization is essentially a cooperative non-stationary dynamic process and it is on the basis of such a model that the impact of regionalism needs to be examined.; In the first chapter I present a model based on Staiger's 1995 model of Gradual Trade Liberalization. I show that Customs Unions are more likely to speed up trade liberalization if they happen late in the trade liberalization process. I also find that high discount factors tend to make Customs Unions more beneficial to trade liberalization.; In the second chapter I adapt a trade liberalization model from Devereux (1997). Regionalism in this chapter is in the form of Common Markets. I confirm that even with a radically different model regionalism that happens late in the trade liberalization process is more likely to lead to a decline in immediate tariffs.; In the third chapter I examine the impact of regionalism using a model with asymmetric countries borrowed from Bagwell and Staiger (1997). Countries are identical in everything but their discount rates. Two of the three countries are extremely patient and one is relatively impatient. I examine the impact of regionalism on the incentives of the impatient country. I find that when the two patient countries engage in regionalism Customs Unions are beneficial to the multilateral process and Free Trade Areas hurt the process. However, if the impatient country and one of the patient countries engage in regionalism, the results change dramatically. In that case, the impact of regionalism depends on the parameters. A low discount factor for the impatient country will be more likely to make the regionalism beneficial to the multilateral process.