What is it about?
This paper investigates the influence of the rise global supply chains on bilateral trade agreements.Given that a few multinational firms are responsible for a major share of world trade, our findings suggest that these firms may support regulatory harmonization across different Preferential Trade Agreements (PTAs) to lower trade costs or resist harmonization –and encourage certain non-tariff measures –to prevent new competitors from entering markets.
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Why is it important?
The finding partly explains the persistence of regulatory divergence. Building on institutional and comparative trade hypothesis, the findings of the paper present new tendencies in the foreign trade policy: the impact of the rise global supply chains on the political economy of trade,motivations for countries in cooperating on trade policies,and the increasing importance of bilateral agreements in the foreign trade policy
Perspectives
Additionally, the findings suggest that the political economy of regulatory convergence may be more complex than is sometimes suggested in the prior literature.
Professor PhD DSc Zdzisław W. Puślecki
Uniwersytet im Adama Mickiewicza w Poznaniu
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This page is a summary of: Bilateral trade agreements and the rise of global supply chains, Journal of Economic & Financial Studies, November 2016, LAR Center Press,
DOI: 10.18533/jefs.v4i05.250.
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