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TRADE LIBERALIZATION AND STRUCTURAL CHANGES IN LATIN AMERICA *
Author(s) -
Ahmad J.
Publication year - 1972
Publication title -
jcms: journal of common market studies
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.54
H-Index - 90
eISSN - 1468-5965
pISSN - 0021-9886
DOI - 10.1111/j.1468-5965.1972.tb00663.x
Subject(s) - economics , latin americans , free trade , international economics , convergence (economics) , per capita , economic integration , international trade , per capita income , differential (mechanical device) , liberalization , trade barrier , empirical evidence , reciprocity (cultural anthropology) , regional integration , macroeconomics , political science , market economy , social psychology , population , philosophy , psychology , demography , engineering , epistemology , sociology , law , aerospace engineering
Wide disparities in growth potential and performance and hence, presumably an unequal sharing of benefits of trade liberalization, are among the most pressing issues facing the future course of economic integration in South America. The customary indices of changes in intra‐zonal trade among members of a preferential trade area do not adequately capture these tensions. This paper develops a framework based on differential rates of growth for analyzing the relative changes in production structure and per capita income in each member country vis‐à‐vis the corresponding set of free‐trading partners. The empirical investigation is carried out for member countries of the Latin American Free Trade Association (LAFTA) and of the Central American Common Market (CACM) for the period of their existence. Preliminary results suggest that although ‘reciprocity’ of benefits has been an elusive goal, there is no evidence that structural imbalance in the continent is worsening. In fact, in terms of per capita incomes there appears to be a modest trend toward convergence.