Free Trade Zone – Explained

Free Trade Zone   Academic Research on Free Trade Zone A reconsideration of the welfare economics of afree–trade zone, Miyagiwa, K. F. (1986). Journal of International Economics,21(3-4), 337-350. This paper presents a model of a free-trade zone which incorporates the fact that such zones are often established by government subsidies designed to promote non-traditional exports. In this model the condition is derived under which the establishment of a free-trade zone can increase welfare regardless of the relative factor intensity of a zone-based industry. The move towardfree trade zones, Krugman, P. (1991). Economic Review,76(6), 5. This paper is divided into three parts. First, it reviews the relatively straightforward economics of preferential trading arrangements. The second is an attempt to describe and analyze the political economy of trade negotiations. The third part tries to pull the economics and politics together, for a general discussion of the problem of free trades areas versus multilateralism. Is afree trade zoneemerging in Northeast Asia in the wake of the Asian financial crisis?, Cai, K. G. (2001). Pacific Affairs, 7-24. This paper explores the absence of a formal regional grouping in Northeast Asia since the mid-1980s in the autonomous and market-driven process of regional economic integration due to existing political constraints. It also explores the role of the recent Asian financial crisis in the provision of a free trade zone in this region. The article also provides a preliminary assessment of the prospect for a free trade zone in the region and speculates on the possible implications of this development for the political economy of Northeast Asia and beyond. A note on the economics of the dutyfree zone, Rodriguez, C. A. (1976). Journal of International Economics,6(4), 385-388. This note extends some of the results of Hamada (1974) on the economic effects of a duty free zone. It is shown that, in the presence of factor mobility between the duty free zone and the rest of the economy, the final equilibrium will yield the same trade pattern which would have prevailed under free trade; moreover, all of the trade will be done by the duty free zone. Cost benefit analysis of thefree trade zonesystem: the impact of foreign direct investment in Costa Rica, Monge Gonzlez, R., Rosales Tijerino, J., & Arce Alpzar, G. (2005).(No. 382.97286 M743c). Washington, US: OEA. Economic determinants offree tradeagreements, Baier, S. L., & Bergstrand, J. H. (2004). Journal of international Economics,64(1), 29-63. The purpose of this study is to provide the first systematic empirical analysis of the economic determinants of the formation of free trade agreements (FTAs) and of the likelihood of FTAs between pairs of countries using a qualitative choice model. It develops this econometric model based upon a general equilibrium model of world trade with two factors of production, two monopolistically-competitive product markets, and explicit intercontinental and intracontinental transportation costs among multiple countries on multiple continents. Free trade zones, Jayawardena, D. L. U. (1983). J. World Trade L.,17, 427. This article explores the creation of free trade zones in both industrialized and developing countries. The article gives and an evaluation of some of the free trade zones which have been established in developing countries. Free trade zonesand industrial development in Malaysia, Rasiah, R. (1993).Industrializing Malaysia: Policy, Performance, Prospects. The locational choice forfree–trade zones: Rural versus urban options, Miyagiwa, K. (1993). Journal of Development Economics,40(1), 187-203. In this study, urban and rural areas are compared as appropriate locations for a free-trade zone within a developing country suffering from urban unemployment. The paper shows that if domestic capital is mobile between the two regions, then the rural area is shown to be preferable to the urban area. The paper provides sufficient conditions for this conclusion, and states other conditions for which this conclusion may be reversed. Commentary: The move towardfree trade zones, Bergsten, C. F. (1991). Economic Review, Federal Reserve Bank of Kansas City, issue Nov, 27-35. Promoting development and stability through a Euro-Mediterraneanfree trade zone, Nienhaus, V. (1999). Eur. Foreign Aff. Rev.,4, 501. This paper will outline and discuss the major economic features of the Euro-Mediterranean Partnership programme as launched in Barcelona in 1995. The paper questions the optimistic view of the European Union (EU) regarding the developmental impact of a Euro-Mediterranean Free Trade Zone (EMFTZ). An economic analysis of the duty-free zone, Hamada, K. (1974).Journal of International Economics,4(3), 225-241. This paper presents a theoretical framework to analyze the economic implication of a duty-free zone, where duties are exempted in order to attract foreign investments. Using the standard two-factor, two-commodity trade model, it is shown that in the absence of foreign investment the establishment of a duty-free zone does not affect production if the protection is in the form of import tariff; also that the increase in foreign investments in the duty-free zones does not necessarily improve the consumption possibilities available to a developing country.