How Effective Is The Free Trade Agreement in South Asia? An Empirical Investigation
We investigate the efficacy of preferential trade liberalization in changing the observed trade pattern among the South Asian countries that have entered into the South Asian Free Trade Agreement (SAFTA). Although in its nascent stage, some data are now available to provide an ex-post evaluation of...
| Main Authors: | , , |
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| Format: | Journal Article |
| Published: |
Routledge
2014
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| Online Access: | http://hdl.handle.net/20.500.11937/36292 |
| _version_ | 1848754727912734720 |
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| author | Islam, A. Bloch, Harry Salim, Ruhul |
| author_facet | Islam, A. Bloch, Harry Salim, Ruhul |
| author_sort | Islam, A. |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | We investigate the efficacy of preferential trade liberalization in changing the observed trade pattern among the South Asian countries that have entered into the South Asian Free Trade Agreement (SAFTA). Although in its nascent stage, some data are now available to provide an ex-post evaluation of the performance of this bloc. Using these data, we find no empirical evidence of trade creation among SAFTA members, which is not surprising given that tariff concessions in SAFTA are small and are offset by complicated rules of origin procedure. However, a substantial and statistically significant increase in exports from SAFTA members to the rest of the world is found. Several panel strategies are used to check the sensitivity of the results against the assumptions of the estimation strategies. As some key coefficient estimates are found to differ across estimation methods, policymakers in South Asia need to use care in relying on the results from empirical studies, including our own, in formulating their trade policies. |
| first_indexed | 2025-11-14T08:45:01Z |
| format | Journal Article |
| id | curtin-20.500.11937-36292 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T08:45:01Z |
| publishDate | 2014 |
| publisher | Routledge |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-362922019-02-19T04:28:08Z How Effective Is The Free Trade Agreement in South Asia? An Empirical Investigation Islam, A. Bloch, Harry Salim, Ruhul international trade flows gravity model of trade South Asia free-trade agreement We investigate the efficacy of preferential trade liberalization in changing the observed trade pattern among the South Asian countries that have entered into the South Asian Free Trade Agreement (SAFTA). Although in its nascent stage, some data are now available to provide an ex-post evaluation of the performance of this bloc. Using these data, we find no empirical evidence of trade creation among SAFTA members, which is not surprising given that tariff concessions in SAFTA are small and are offset by complicated rules of origin procedure. However, a substantial and statistically significant increase in exports from SAFTA members to the rest of the world is found. Several panel strategies are used to check the sensitivity of the results against the assumptions of the estimation strategies. As some key coefficient estimates are found to differ across estimation methods, policymakers in South Asia need to use care in relying on the results from empirical studies, including our own, in formulating their trade policies. 2014 Journal Article http://hdl.handle.net/20.500.11937/36292 10.1080/02692171.2014.918940 Routledge fulltext |
| spellingShingle | international trade flows gravity model of trade South Asia free-trade agreement Islam, A. Bloch, Harry Salim, Ruhul How Effective Is The Free Trade Agreement in South Asia? An Empirical Investigation |
| title | How Effective Is The Free Trade Agreement in South Asia? An Empirical Investigation |
| title_full | How Effective Is The Free Trade Agreement in South Asia? An Empirical Investigation |
| title_fullStr | How Effective Is The Free Trade Agreement in South Asia? An Empirical Investigation |
| title_full_unstemmed | How Effective Is The Free Trade Agreement in South Asia? An Empirical Investigation |
| title_short | How Effective Is The Free Trade Agreement in South Asia? An Empirical Investigation |
| title_sort | how effective is the free trade agreement in south asia? an empirical investigation |
| topic | international trade flows gravity model of trade South Asia free-trade agreement |
| url | http://hdl.handle.net/20.500.11937/36292 |