Master of Arts / Department of Economics / Peri da Silva / Preferential Trade Agreements (PTAs) are known to facilitate liberalization with respect to only a few trading partners and thus they have been a topic of debate for the past two decades especially because their effect on most favored nation (MFN) tariffs is known to be ambiguous. We provide insights for analyzing whether the PTAs indeed hamper or support multilateral liberalization. Using product level official and actual tariffs we provide evidence from the United States (US) import data that the stumbling block effect on the US MFN bound tariffs is present only for goods that receive full preference in books or in actual. However, my dataset does not statistically support the stumbling block hypothesis in the case of Applied tariffs.

Thesis advisor: Robert Murphy / Given the increasing proliferation of preferential trade agreements, this work seeks to investigate the economic, political, and cultural relationships that may be built from the common foundation of a trade agreement. It evaluates the experiences of the European Union and the North American Free Trade Agreement and makes predictions and suggestions for future preferential trading partners, as well as analyzing the potential impact that PTAs will have on globalization and international relations. / Thesis (BA) — Boston College, 2004. / Submitted to: Boston College. College of Arts and Sciences. / Discipline: International Studies. / Discipline: College Honors Program.

Since the inception of the General Agreement on Tariffs and Trade (GATT) in 1947, traditional trade barriers like tariffs and quotas were no longer at the heart of trade disputes under the multilateral trade framework. The economic interdependence trend has brought a number of social issues to the forefront of the international scene, and the conflict between trade values and social values have soon become the new theme of trade conflicts at the current stage. Hence, international trade rules were urged to address issues other than economic concerns, such as environmental protection, cultural value preservation and human rights. Clashes between trade liberalization and social values are harshly criticized for their alleged negative impacts on issues like equality, freedom, social justice, environment and culture. The World Trade Organization (WTO), as the only multilateral trade regime, is arguably extending its competence in dealing with conflicts other than trade issues. However, the conflicts are made more incomprehensible due to the absence of a clear and reconciled order in both substantive and procedure senses. This research is based on the aforementioned concerns, and focuses on the relationship between trade liberalization and a specific spot among the enormous range of social values: Trade in Culture. Departing from domestic regime, the research is going to critically evaluate domestic state of law and policies under the realm of WTO rules, in order to carry out their interactions with WTO regime. By analyzing to what extent they collide with each other, and the possible alternatives to develop cultural trade, the research considers the development of cultural trade in the way that is more responsive to the real problems of current restraints presented at the domestic level, so that implications to the WTO legal framework can be drawn.

Doctor of Philosophy / Department of Economics / Yang M. Chang / There have been considerable discussions about why countries have interests in forming preferential trade agreements (PTAs), which typically take the forms of a “free trade area” (FTA) with Rules of Origin (ROO) and a “customs union” (CU) (World Bank, 2005). This dissertation contains three essays with three different models of trade under oligopoly to analyze various issues on preferential trade agreements. The first essay examines welfare implications of forming preferential trade arrangement (PTAs) between two asymmetric countries that differ in their market sizes. Key findings are as follows. First, when market size asymmetry between two countries is not too large and ROO requirements are not too restrictive, the formation of an FTA with effective ROO can be welfare-improving to both members. Second, the formation of a PTA is more likely to emerge between countries of similar in their market sizes, ceteris paribus. Third, compared to the pre-PTA equilibrium, there are greater reductions in external tariffs under an FTA than under a CU such that a non-member country is relatively better off under the FTA. The second essay presents a three country model of trade under Bertrand price competition to analyze differences in welfare implications between an FTA with ROO and a customs union (CU). It is shown that the maximum limit of ROO requirements over which there are welfare gains from trade for FTA members depends crucially on the degree of substitutability of final goods (or the intensity of product market competition). It is also found that member countries and their final-good exporters are better off in a CU than in an FTA. There are greater reductions in external tariffs under an FTA than under a CU such that a non-member country is relatively better off under the FTA. The third essay presents a three country model of FTA with Cournot quantity competition and derives the maximum enforceable level of ROO over which there are welfare gains from trade to each member country. It is shown that ROO and external tariffs are strategic complements such that the higher is the regional input restrictions, the higher is the external tariff necessary to induce firms to fully comply with ROO requirements. It is also shown that an FTA with effective ROO has a positive effect on the final-good trade. But the trade-diverting effect does not occur in the final-good sector.

Emissions keep rising, states keep trading, and Earth will be 1.5°C warmer within five years. These are results of inadequate global governance. As globalisation has brought complexity to the international settings, creating overlapping webs of interactions: no International Organisation has properly responded. In this context, we are now situated in a trade regime complex with overlapping rules and norms, but what agency can be claimed? The thesis investigates the trade-environment nexus by addressing how legitimate climate leadership in a trade regime complex is pursued.   By challenging the conventionality of international leadership theory with a separation from hegemony and applying it outside multilateral negotiations, the thesis found it applicable for this new setting. Through mixed methods, statistics and textual analysis, the United States (US) Preferential Trade Agreements (PTA) were a surprisingly fitted case for this. To understand climate leadership performance and underlying objectives for such, the TREND database was adopted. Within, all US PTAs are shown and to what extent it has adapted 294 environmentally-related norms. Coded into means for leadership, the US legalistic approach of structurally directing others to mitigating measures seems to be a double-edged sword. Done right, it creates non-derogative measures. Done wrong, it creates a hegemon.

Many studies consider the potential for preferential trade agreements (PTAs) to have differing effects on trade. Kohl (2014) and Baier et al. (2019) show that some PTA’s promote trade while the majority of PTAs have no significant effect. Some even lower trade. Why do these differing cases arise? One possibility is that the effects of trade agreements depend on specific provisions – provisions that differ across agreements. Another possibility is the potential for PTAs to impact trade differently depending on the presence of certain bilateral characteristics between trading nations such as physical distance or metaphorical types of distance such as culture or language. In my dissertation, “Heterogeneous Effects of Trade Agreements on Trade,” we explore these two avenues separately.In the first chapter we consider if differences in the prevalence of corruption between members of a PTA make trade agreements more or less effective at boosting trade. Such differences could create more uncertainty that limits the potential for trade even if a trade agreement lowers barriers, implying that such agreements will not boost trade. On the other hand, trade agreements could be most effective in such disparate countries. Not only might trade agreements remove barriers used by corrupt officials to extort firms, but a trade agreement could reduce the uncertainty of operating in a different business environment by establishing rules and regulations. Results in this paper are allowed to differ across several dimensions, including extensive versus intensive margin, whether the exporter or importer is more corrupt, and between South-South and South-North trade. Using a gravity model of trade spanning a panel of countries from 1996 to 2017, we find that PTAs increase trade more along the intensive margin when importing countries are more corrupt but boost trade more along the extensive margin when exporting countries are more corrupt. Results are stronger for trade between South-South (S-S) countries than between North-South (N-S) countries. Chapter two examines how specific provisions within trade agreements – particularly, provisions regarding environmental standards – affect trade between members and non-members. While there is a rising trend to incorporate different types of environmental provisions in preferential trade agreements (PTAs), few studies took explicit steps to assess the trade consequences of environmental provisions in PTAs. This paper employs a gravity model over the period from 1984 to 2016 and uses a new detailed dataset on a broad range of environmental provisions in PTAs to fill the gap in the literature by looking at possible trade diversion effects from trade agreements with deep environmental clauses. We follow Mattoo et al. (2017) and construct an index that captures importers’ average depth of trade agreements with the rest of the world where depth is taken as the extent that environmental provisions are covered. The inclusion of this depth variable allows us to see if any trade diversion effect arises from trade agreements with deep environmental provisions. We specifically focus on exporters with low environmental standards, as those are the countries that are likely to “host” trade in environmentally unsustainable goods. We also differentiate between different types of environmental policies and concentrate on trade in “dirty” products. Our results suggest that environmental provisions in PTAs are an effective tool of promoting environmentally sustainable trade in the world, as these types of policies tend to reduce “dirty” trade even with non-member nations. Finally, the third chapter considers the heterogeneous design of PTA’s more broadly, looking at the trade effects of different policy areas within trade agreements, while differentiating their impact on trade in new product varieties of goods versus trade in existing products. We specifically focus on 18 “core” provisions that Hofmann et al. (2019) mark as most economically relevant policies. We further distinguish three types of policies within the “core” group of provisions, namely: i) provisions that directly liberalize trade through either reduction in tariffs or simplification of standards, ii) policies that enable signatory nations to compete on equal grounds, and iii) provisions that specify the rules of investment. Previous studies that consider the effects of trade agreements on the margins of trade have either focused on the effects of different types of PTAs, rather than specific policies, or used limited data and outdated methodologies. We are contributing to the literature by assessing the impact of different groups of policies on the margins of international trade using a highly disaggregated dataset covering a large number of countries and years. We also employ Factor Analysis to check robustness of our findings using regular count indices. Our results indicate that provisions that tend to reduce barriers to trade through either simplification of standards or reduction in monetary charges tend to increase trade in existing varieties of goods, while the effect of investment provisions is either insignificant or might actually lower trade.

The Generalized System of Preferences (GSP) is a unilateral trade liberalization program in which developed countries offer non-reciprocal tariff reductions (tariff preferences) on certain products imported from designated developing and least developed countries. GSP is considered an important tool in the World Trade Organization's approach to development. This dissertation--composed of three essays--explores whether low-income countries have achieved an increased access to high-income markets as a result of these non-reciprocal tariff preferences offered to their exports. The first essay provides an overview of the GSP program. The second essay presents an evaluation of the GSP program by considering the products and markets where low-income countries' exports are concentrated. Using a theoretically consistent gravity equation for primary and processed agri-food trade over the period 1962-2010, the results illustrate that the GSP program and modifications of it have delivered significant positive effects in developing countries' exports to developed country markets in agricultural trade but not necessarily so in non-agricultural goods. The third essay develops two theoretically founded novel indices to measure preference margins offered by high-income countries to low-income countries through tariff reduction. One index captures the restrictions bilateral tariff rates impose on market access conditions of a country as compared to the most favored nation rate, called the Exponential Trade Restrictiveness Index (ETRI). The other index captures the relative ease with which a country can access foreign markets compared to its competing suppliers, called the Exponential Relative Preferential Margin (ERPM). Then, these two bilateral indices are used to develop a model of sector-based bilateral trade to re-evaluate the Generalized System of Preferences (GSP) in terms of relative market access preferences. The results show that the GSP has increased relative market accessibility for low-income countries and in turn boosted exports from these countries by 26 to 28 percent. / Ph. D.

Esta tese aborda o desenvolvimento da regulação internacional sobre o comércio de serviços educacionais, em especial nos acordos preferenciais de comércio de Austrália, Chile, China, Cingapura, Estados Unidos, Índia e União Europeia. O seu objetivo foi avaliar o atual nível de liberalização comercial da educação superior no plano global, de modo que sua compatibilidade com o direito à educação pudesse ser criticamente analisada, assim como os seus possíveis impactos sobre a regulação da educação superior no Brasil. Para tanto, a pesquisa começa pela realização de entrevistas com atores que acompanham o processo de comercialização da educação superior no Brasil. Os passos seguintes envolvem a compreensão do funcionamento das disciplinas internacionais sobre o comércio de serviços, da formulação das posições no processo negociador e, finalmente, dos compromissos em serviços de educação superior em acordos preferenciais de comércio. Uma primeira hipótese é de que, mesmo sem acordos de comércio, o mercado brasileiro já se encontra significativamente liberalizado no que diz respeito aos investimentos estrangeiros em educação superior, sem qualquer restrição ao ingresso de capital internacional. Ainda assim, a regulação internacional do comércio de serviços aprofundaria esse processo a partir da ideia de consolidação do marco regulatório liberal doméstico e de mecanismos que conduzem à aceleração do processo de liberalização comercial. / This thesis analyses the development of international regulation on trade in educational services, especially in preferential trade agreements signed by Australia, Chile, China, Singapore, United States, India and the European Union. The goal was to determine a parameter of the current global level of trade liberalization on higher education, so that the compatibility between trade agreements and the right to education could be critically examined, as well as their possible impacts on the regulation of higher education in Brazil. Therefore, the research began by conducting interviews with professionals that accompany the commercialization process in the Brazilian higher education sector. The following steps involved understanding the operation of international disciplines on trade in services, the formulation of positions in the negotiating process, and finally, the commitments on higher education services in preferential trade agreements. A first hypothesis is that, even without trade agreements, the Brazilian market is already significantly liberalized regarding foreign investment on higher education, without any restriction on the inflow of international capital. Even so, international regulation on trade in services would deepen this process from an idea of consolidation of a liberal domestic regulatory framework and mechanisms leading to accelerate trade liberalization process.

O artigo analisa os capítulos sobre propriedade intelectual dos acordos preferenciais de comércio firmados pelos Estados Unidos com países da América Latina na década de 2000, discutindo tanto as motivações do país para a assinatura dos mesmos (e inserindo tal discussão em um framework teórico) quanto as implicações dos acordos para os direitos de propriedade intelectual de seus signatários. Nesse sentido, apresenta algumas teorias acerca das características intrínsecas a instituições internacionais multilaterais, em contraste com as bilaterais e regionais; tais teorias afirmam que os estados, ao lidarem com resultados indesejados de características institucionais, modificam instituições (ou criam novas instituições) de acordo com seus objetivos. Em seguida, apresenta o resultado de um levantamento bibliográfico acerca das motivações estadunidenses para a assinatura dos mencionados acordos preferenciais de comércio, com ênfase nas relacionadas aos direitos de propriedade intelectual; tal resultado é complementado com a análise dos documentos primários pertinentes. Por fim, compara o conteúdo dos mencionados capítulos entre si; também os compara com o Acordo TRIPS da OMC. O artigo conclui que as motivações estadunidenses coincidem com as expectativas teóricas; que os capítulos analisados são substancialmente diferentes do Acordo TRIPS; que eles contêm diversas diferenças entre si (as quais são, em parte, decorrentes de exigências do legislativo estadunidense); e que ainda há espaço para pesquisas sobre a política comercial estadunidense praticada no período, no que tange à sua interface com os direitos de propriedade intelectual. / The article analyzes the intellectual property rights chapters of the preferential trade agreements signed by the United States with Latin American countries during the 2000s, discussing both the country\'s reasons for signing such agreements (and inserting such discussion in a theoretical framework) and their implications to the intellectual property rights of its signatories. In this regard, it presents some theories about the features intrinsic to the multilateral international institutions, when contrasted with the bilateral and regional ones; such theories claim that states, when dealing with undesired effects of institutional features, modify institutions (or create new ones), in accordance with their objectives. Then, the article presents the findings of a literature review about the U.S. reasons for signing the aforementioned preferential trade agreements, emphasizing those reasons related to intellectual property rights; such findings are complemented by the analysis of the pertinent primary documents. Finally, it compares the content of the chapters with each other; it also compares them with the WTO TRIPS Agreement. It concludes that the U.S. reasons presented coincide with the theoretical expectations; that the analyzed chapters are substantially different from the TRIPS Agreement; that the chapters have many differences with each other (which are, in part, due to U.S. Congress requirements); and that there is still room for new researches on the U.S. trade policy practiced during the analyzed period, when it comes to its interface with intellectual property rights.

A América do Sul, na história recente, foi palco de diversas ações de integração regional relacionadas ao comércio, influenciando os posicionamentos dos países em matéria de políticas de comércio interncional bem como formando um emaranhado de relações que se sobrepõe muitas vezes de formas antagônicas. Neste contexto, a presente dissertação aborda o histórico das principais blocos regionais que envolvem a América do Sul como base para mostrar a atual fragmentação deste subcontinente em três visões principais de política de comércio internacional, sendo uma visão intermediária caracterizada pelo Brasil e acompanhada pelos membros do MERCOSUL em uma vertente regional-multilateralista. Em um extremo estão Venezuela, Equador e Bolívia, representantes da ALBA, com seus governos de posicionamento extremo-nacionalista. E em posição antagônica a estes estão Chile, Peru e Colômbia, que conformam o eixo liberal-bilateralista. Objetivando comprovar que há uma tendência de fortalecimento da visão liberal-bilateralista na região será feito um estudo com base nas suas principais formas de atuação, ou seja, por meio da análise de Acordos Preferenciais de Comércio, mais especificamente FTAs bilaterais celebrados com países de distintas regiões com foco especial ao período imediatamente após a eclosão da crise de 2008, de 2009-2014. Finalmente, se a hipótese se confirmar, restando evidenciada a retomada do posicionamento bilateralista, após período de predominância da visão multilateralista na América do Sul, é importante apontar os desafios para o Brasil neste cenário. / South America, in recent history, has had several regional integration actions related to trade, influencing the countries positions in terms of international trade policies as well as forming a tangle of relationships that often overlaps with contrary views. In this context, this thesis addresses the history of the main regional blocs involving South America as a basis to show the current fragmentation of this subcontinent in three main views of international trade policy, with an intermediate vision characterized by Brazil and followed also by members of the MERCOSUR in a regional-multilateralist position. At one extreme, the countries Venezuela, Ecuador and Bolivia, ALBA representatives, present their extreme-nationalist position. And in an antagonistic position, Chile, Peru and Colombia constitute the liberal-bilateralist axis. In order to prove that there is a trend towards the strengthening of the liberal-bilateralist vision in the region, a research based on analysis of Preferential Trade Agreements will be held, focusing bilateral FTAs concluded with different countries regions with special attention to the period immediately after the outbreak of the 2008 crisis, from 2009 to 2014. Finally, if the hypothesis is confirmed, demonstrating the resumption of the bilateralist position after a period in which the multilateralist vision was predominant in South America, it is important to point the challenges of this scenario for Brazil.