Regional Integration and Gro w t h in Developing Nations

Abstract

This paper explores the growth implications of regional integration. Fro m the theory, it identifies the 'footprints' that such growth should leave in the data. It then checks the data on the four poor EU nations for such footprints. Prima facie evidence for Ireland, Portugal and Spain support the notion that EU membership induced investment-led growth, but Greek data reject it. This suggests that the integration of relatively poor nations into a rich trading bloc f a v o u r ed the poor nation's investment rates, however this was not stro n g enough to overcome poor macroeconomic management and market rigidities (which were features of the Greek case). (JEL Classification: F43, O4, F15)

Eastern Enlargement of the EU: Jobs, Investment and Welfare in Present Member Countries

“…If there were no increasing returns, the adjustment mechanism would be completed. If, however, the output gains lead mainly to entry of new firms and a larger product variety n (Y ), the resulting gains from specialization will reduce the cost P of investment goods and thereby strengthen investment incentives, see (5). Job rents should increase along with higher capital intensity and trigger increased recruitment by firms.…”

“…We do this on a the 6-digit level of the Harmonized System, which comprises over 5,000 different commodities, using post-Uruguay-round nominal MFN rates. 5 For imports, we also calculate a weighted average measure of non-tariff barriers. Taking such structural details into account, one observes that the differences across countries are somewhat less pronounced.…”

Assessment of latin American and Caribbean Countries in the international economy

“…The success for trade-induced growth, as Baldwin and Seghezza [1998] have pointed out, will depend on one of three types, which can be skill-led through the accumulation of human capital, investment-led through the accumulation of physical capital, or technology-led through the accumulation of knowledge capital. The Latin American and Caribbean region is s~:riving to accomplish these ends through economic integration by encountering difficulties.…”

Lessons from NAFTA for Latin America and the Caribbean

“…In chapter 2 we noted the difficulty in identifying the impact of NAFTA on Mexico's economic performance in recent years, partly as a result of the little change in Greece, a fact that has been attributed to Greece's distorted policy environment in the 1980s (Baldwin and Seghezza 1998). This serves as a reminder that membership in a regional integration initiative is no guarantee of increased FDI.…”