"Building" or "stumbling" blocks Analysis of the trade creation and trade diversion effect. The case of ASEAN-Korea free trade agreement (AKFTA)
(2019) NEKH02 20191Department of Economics
- Abstract
- Using trade data from the UNCTAD for 31 countries from 2000 to 2016, this study examines the success of the ASEAN-Korea FTA (AKFTA) by measuring the effect on import performance among member countries. A modified gravity model has been used to address both the issues of unobserved multilateral resistance terms and endogeneity biases to obtain consistent and efficient estimation results. The evidence suggests no evidence of trade effects as the thesis fails to provide statistically significant results. The thesis argues that insignificant trade effects relate to factors that dissuade firms from utilizing FTAs efficiently or at all. Thus, governments are recommended to take on a more proactive role in communicating trade policy to firms by... (More)
- Using trade data from the UNCTAD for 31 countries from 2000 to 2016, this study examines the success of the ASEAN-Korea FTA (AKFTA) by measuring the effect on import performance among member countries. A modified gravity model has been used to address both the issues of unobserved multilateral resistance terms and endogeneity biases to obtain consistent and efficient estimation results. The evidence suggests no evidence of trade effects as the thesis fails to provide statistically significant results. The thesis argues that insignificant trade effects relate to factors that dissuade firms from utilizing FTAs efficiently or at all. Thus, governments are recommended to take on a more proactive role in communicating trade policy to firms by using such formats as education or outreach programs. Furthermore, the information should be complemented with guidance and direct assistance in the implementation and interpretation of policy in the practical everyday utilization of FTAs. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/8995310
- author
- Trinh, Jenni LU
- supervisor
- organization
- course
- NEKH02 20191
- year
- 2019
- type
- M2 - Bachelor Degree
- subject
- keywords
- AKFTA, trade creation, trade diverion, gravity model, utilization
- language
- English
- id
- 8995310
- date added to LUP
- 2019-10-25 09:07:31
- date last changed
- 2019-10-25 09:07:31
@misc{8995310, abstract = {{Using trade data from the UNCTAD for 31 countries from 2000 to 2016, this study examines the success of the ASEAN-Korea FTA (AKFTA) by measuring the effect on import performance among member countries. A modified gravity model has been used to address both the issues of unobserved multilateral resistance terms and endogeneity biases to obtain consistent and efficient estimation results. The evidence suggests no evidence of trade effects as the thesis fails to provide statistically significant results. The thesis argues that insignificant trade effects relate to factors that dissuade firms from utilizing FTAs efficiently or at all. Thus, governments are recommended to take on a more proactive role in communicating trade policy to firms by using such formats as education or outreach programs. Furthermore, the information should be complemented with guidance and direct assistance in the implementation and interpretation of policy in the practical everyday utilization of FTAs.}}, author = {{Trinh, Jenni}}, language = {{eng}}, note = {{Student Paper}}, title = {{"Building" or "stumbling" blocks Analysis of the trade creation and trade diversion effect. The case of ASEAN-Korea free trade agreement (AKFTA)}}, year = {{2019}}, }