The Cost of Non-Europe, Revisited
This research quantifies the trade-related welfare gains from the European Union (EU) and the costs of potential EU disintegration.
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| Quick Facts | |
|---|---|
| Report location: | source |
| Language: | English |
| Publisher: | Centre d'Etudes Prospectives et d'Informations Internationales |
| Authors: | Soledad Zignago, Vincent Vicard, Thierry Mayer |
| Geographic Focus: | Europe |
| Page count: | 50 pages |
Methods
The research method involves modern versions of the gravity model to estimate the trade creation effects of the EU. Counterfactual exercises are used to quantify the impact of different scenarios of EU disintegration, including a return to a standard RTA or to WTO rules.
(Generated with the help of GPT-4)
Key Insights
The study estimates the trade effects of the EU, revealing significant welfare gains for member countries. It uses structural gravity models to assess trade creation by the EU and applies counterfactual exercises to scenarios where the EU reverts to a “normal” Regional Trade Agreement (RTA) or to World Trade Organization (WTO) rules. The findings suggest that the Single Market increases bilateral trade substantially more than a standard RTA and that the costs of non-Europe vary significantly across member states, with smaller, open economies, especially in Eastern Europe, benefiting the most. The research also explores the potential cascade effects of Brexit on trade agreements.
(Generated with the help of GPT-4)
Additional Viewpoints
Categories: 2018 publication year | Europe geographic scope | English publication language | brexit | cost of non-europe | counterfactual analysis | economic impact | economy | european union | globalisation | gravity model | growth | rta | trade creation | trade integration | welfare gains | wto