Does Membership in a Regional Preferential Trade Arrangement Make a Country More or Less Protectionist?

The author explores whether a systematic relationship exists between a developing country's participation in a preferential regional trade agreement (RTA) and the restrictiveness of its trade regime. The motivation for her study is provided by the current debate about whether regional trading blocs are a stepping-stone toward a more liberal global trading system and whether these blocs have changed over time so that the"new"blocs differ meaningfully from the"old"ones in terms of openness to the rest of the world. She restricts analysis to reciprocal RTAs involving developing countries in partnership either with industrial countries (North-South RTAs) or with other developing countries (South-South RTAs). Nearly every developing country belongs to one or more RTAs, so the author develops criteria for distinguishing effective from noneffective regional blocs. She then taps into many sources of data to compare levels of restrictiveness. She finds no evidence that participation in a regional trade agreement necessarily leads to a more liberal important regime.