The Effect of a Free -Trade Agreement upon Agricultural Imports

Authors: Andres G. Victorio, Montita Rungswang

Abstract:

A free-trade agreement is found to increase Thailand-s agricultural imports from New Zealand, despite the short span of time for which the agreement has been operational. The finding is described by autoregressive estimates that correct for possible unit roots in the data. The agreement-s effect upon imports is also estimated while considering an error-correction model of imports against gross domestic product.

Keywords: Agricultural imports, free trade, unit roots, cointegration, error correction.

Digital Object Identifier (DOI): doi.org/10.5281/zenodo.1329046

References:

[1] New Zealand Closer Economic Partnership: A Joint Study Investigating the Benefits of a Closer Economic Partnership Agreement Between Thailand and New Zealand, New Zealand Ministry of Foreign Affairs and Trade, Wellington, New Zealand, 2005.
[2] J. Bhagwati, D. Greenaway, and A. Panagariya, "Trading preferentially: Theory and policy," The Economic Journal, vol. 108, pp. 1128-1148, July1998.
[3] P. R. Krugman, and M. Obstfeld, International Economics: Theory & Policy, 7th ed., New York: Pearson Addison-Wesley, New York, 2006.
[4] C. Granger, and P. Newbold, "Spurious regressions in econometrics," Journal of Econometrics, vol. 2, pp. 111-120, January 1974.
[5] D.A. Dickey, and W.A. Fuller, "Distribution of the estimators for autoregressive time series with a unit root, Journal of the American Statistical Association, vol. 74, pp. 427-431, March 1979, .
[6] R.F. Engle, and C. Granger, "Co-integration and error correction: Representation, estimation and testing," Econometrica, vol. 55, pp. 251- 276, March 1987.
[7] M. Salmon, "Error correction mechanisms," Economic Journal, vol. 92, pp. 615-629, September 1982.
[8] W. Enders, T. Sandler and J. Cauley, "Assessing the impact of terroristthwarting policies: An intervention time series approach," Defense Economics, vol. 2, pp. 1-18, December 1990.