The impacts of Malaysian free trade agreements on margins of trade
The proliferation of Free Trade Agreements (FTAs) is a phenomenon in the world trading system. The number of FTA establishments has increased tremendously, from 55 in 1995 to more than 250 by end of 2014. Malaysia alone has signed twelve FTAs involving twenty trading partners. Using the most aggrega...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Universiti Kebangsaan Malaysia
2018
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| Online Access: | http://psasir.upm.edu.my/id/eprint/74203/ http://psasir.upm.edu.my/id/eprint/74203/1/74203.pdf |
| _version_ | 1848857454383726592 |
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| author | Said, Rashidi Ismail, Normaz Wana |
| author_facet | Said, Rashidi Ismail, Normaz Wana |
| author_sort | Said, Rashidi |
| building | UPM Institutional Repository |
| collection | Online Access |
| description | The proliferation of Free Trade Agreements (FTAs) is a phenomenon in the world trading system. The number of FTA establishments has increased tremendously, from 55 in 1995 to more than 250 by end of 2014. Malaysia alone has signed twelve FTAs involving twenty trading partners. Using the most aggregated data at the Harmonized System six digit level from 1994 to 2014, this paper examines the impacts of twelve Malaysian FTAs on two trade adjustments: namely, extensive and intensive margins. Our results show that, for most of the FTAs, the trade is created along the intensive margin when FTAs enter into force. Interestingly, most of them are regional FTAs in which there has been a shift in overall trade patterns—a 4.0% reduction in trade of new products (extensive margin) generated from bilateral FTAs to a 41.6% increase in trade of existing products (intensive margin) from when regional FTAs entered into force. These findings may be contrary to the views that countries prefer to negotiate and sign more bilateral FTAs because of the trade benefits that may be gained from deeper market access than is possible with regional FTAs. |
| first_indexed | 2025-11-15T11:57:48Z |
| format | Article |
| id | upm-74203 |
| institution | Universiti Putra Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-15T11:57:48Z |
| publishDate | 2018 |
| publisher | Universiti Kebangsaan Malaysia |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | upm-742032025-06-13T07:26:46Z http://psasir.upm.edu.my/id/eprint/74203/ The impacts of Malaysian free trade agreements on margins of trade Said, Rashidi Ismail, Normaz Wana The proliferation of Free Trade Agreements (FTAs) is a phenomenon in the world trading system. The number of FTA establishments has increased tremendously, from 55 in 1995 to more than 250 by end of 2014. Malaysia alone has signed twelve FTAs involving twenty trading partners. Using the most aggregated data at the Harmonized System six digit level from 1994 to 2014, this paper examines the impacts of twelve Malaysian FTAs on two trade adjustments: namely, extensive and intensive margins. Our results show that, for most of the FTAs, the trade is created along the intensive margin when FTAs enter into force. Interestingly, most of them are regional FTAs in which there has been a shift in overall trade patterns—a 4.0% reduction in trade of new products (extensive margin) generated from bilateral FTAs to a 41.6% increase in trade of existing products (intensive margin) from when regional FTAs entered into force. These findings may be contrary to the views that countries prefer to negotiate and sign more bilateral FTAs because of the trade benefits that may be gained from deeper market access than is possible with regional FTAs. Universiti Kebangsaan Malaysia 2018 Article PeerReviewed text en cc_by_4 http://psasir.upm.edu.my/id/eprint/74203/1/74203.pdf Said, Rashidi and Ismail, Normaz Wana (2018) The impacts of Malaysian free trade agreements on margins of trade. Jurnal Ekonomi Malaysia, 52 (1). pp. 169-178. ISSN 0127-1962; eISSN: 2716-6058 https://www.ukm.my/jem/article/the-impacts-of-malaysian-free-trade-agreements-on-margins-of-trade/ 10.17576/JEM-2018-5201-14 |
| spellingShingle | Said, Rashidi Ismail, Normaz Wana The impacts of Malaysian free trade agreements on margins of trade |
| title | The impacts of Malaysian free trade agreements on margins of trade |
| title_full | The impacts of Malaysian free trade agreements on margins of trade |
| title_fullStr | The impacts of Malaysian free trade agreements on margins of trade |
| title_full_unstemmed | The impacts of Malaysian free trade agreements on margins of trade |
| title_short | The impacts of Malaysian free trade agreements on margins of trade |
| title_sort | impacts of malaysian free trade agreements on margins of trade |
| url | http://psasir.upm.edu.my/id/eprint/74203/ http://psasir.upm.edu.my/id/eprint/74203/ http://psasir.upm.edu.my/id/eprint/74203/ http://psasir.upm.edu.my/id/eprint/74203/1/74203.pdf |