BUSI 464 Week 3 Research Paper: Annotated Bibliography Example

Regional Trade Agreements and the Path to Membership: An Annotated Bibliography

Topic and Research Question

Topic: regional trade agreements around the world and the process countries follow to join them. Research question: What do regional trade agreements do for their members, how do they differ across regions, and what must a country do, and gain, by joining one? The paper will survey the major agreements region by region, following Lynch (2010), and then examine accession, using the European Union as the most developed example and comparing it with simpler free trade areas.

Annotated Bibliography

Baier, S. L., & Bergstrand, J. H. (2007). Do free trade agreements actually increase members' international trade? Journal of International Economics, 71(1), 72-95. https://doi.org/10.1016/j.jinteco.2006.02.005

Baier and Bergstrand (2007) tackle a problem that undermined earlier estimates: countries that sign free trade agreements may already be natural trading partners, so a simple comparison overstates the agreements' effect. Using panel data and methods that account for this, they estimate that an agreement roughly doubles two members' bilateral trade after about ten years. Its careful method and wide use in later research make it a strong foundation. It will support the paper's opening section on why countries pursue agreements at all, since the expected trade gain is the main motive a government would weigh before applying to join one.

Baldwin, R., & Jaimovich, D. (2012). Are free trade agreements contagious? Journal of International Economics, 88(1), 1-16. https://doi.org/10.1016/j.jinteco.2012.03.009

This article tests the domino theory of regionalism, the idea that agreements signed by others push a country to sign its own. Baldwin and Jaimovich (2012) build a measure of how much a country's exporters stand to lose when its partners sign agreements elsewhere and find that this pressure predicts the country's own new agreements. The evidence is global and the measure is clearly defined, though it explains only part of why agreements form. It will support the paper's discussion of why the number of agreements has grown and why countries seek to join existing blocs rather than stay outside them.

Campos, N. F., Coricelli, F., & Moretti, L. (2019). Institutional integration and economic growth in Europe. Journal of Monetary Economics, 103, 88-104. https://doi.org/10.1016/j.jmoneco.2018.08.001

Campos et al. (2019) estimate what membership in the European Union has meant for the countries that joined, comparing each new member with a synthetic version of itself built from similar countries that did not join. They find that per capita incomes were on average about 12 percent higher in the first decade after accession than they would otherwise have been, with large differences across countries. The method is rigorous and directly answers the question of what joining gains. It will be the central evidence in the paper's section on the benefits of accession, balanced against the costs described in the conditionality literature.

Dür, A., Baccini, L., & Elsig, M. (2014). The design of international trade agreements: Introducing a new dataset. The Review of International Organizations, 9(3), 353-375. https://doi.org/10.1007/s11558-013-9179-8

This article introduces the Design of Trade Agreements dataset, which codes several hundred agreements signed since 1945 for their depth, covering provisions on tariffs, services, investment, standards, public procurement, competition and intellectual property. Dür et al. (2014) show that agreements have become deeper over time and that their design varies widely. The source is a dataset paper rather than a test of a theory, but it is the most useful single map of what agreements contain. It will support the paper's comparison of agreements across regions, especially the contrast between shallow tariff deals and deep integration such as the European single market.

Freund, C., & Ornelas, E. (2010). Regional trade agreements. Annual Review of Economics, 2, 139-166. https://doi.org/10.1146/annurev.economics.102308.124455

Freund and Ornelas (2010) review the economic research on regional agreements, covering trade creation and diversion, the effects on members' external tariffs and the building-block debate. They conclude that trade diversion has been less of a problem than early theory feared and that regional agreements have not generally slowed multilateral liberalization. As a review in a leading journal, it is broad and balanced, though it predates the largest recent agreements. It will frame the paper's background section and supply the definitions of trade creation, trade diversion and the building-block debate that later sections use.

Kohl, T., Brakman, S., & Garretsen, H. (2016). Do trade agreements stimulate international trade differently? Evidence from 296 trade agreements. The World Economy, 39(1), 97-131. https://doi.org/10.1111/twec.12272

Kohl et al. (2016) estimate the trade effects of 296 agreements separately instead of assuming they all work alike. They find that effects vary widely, that many agreements have little measurable effect, and that agreements whose provisions are deeper and legally enforceable tend to raise trade more. The breadth of the sample is the source's main strength. It will support the paper's argument that what an agreement contains matters more than its name, and it will qualify the average effect reported by Baier and Bergstrand (2007), which a country considering accession should not assume will apply to every agreement.

Mansfield, E. D., & Milner, H. V. (1999). The new wave of regionalism. International Organization, 53(3), 589-627. https://doi.org/10.1162/002081899551002

Mansfield and Milner (1999) review the political economy of regionalism and explain why a new wave of agreements formed after the Cold War. They emphasize domestic interest groups, the strategic interests of states and the institutions of the multilateral trading system as forces that shape which agreements form and who joins. The article is older but remains a standard political science account and adds the political side that economic studies leave out. It will support the paper's section on the process of joining, which is as much a political decision, made by governments facing domestic winners and losers, as an economic one.

Schimmelfennig, F., & Sedelmeier, U. (2004). Governance by conditionality: EU rule transfer to the candidate countries of Central and Eastern Europe. Journal of European Public Policy, 11(4), 661-679. https://doi.org/10.1080/1350176042000248089

This article explains how the European Union persuaded candidate countries to adopt its rules before joining. Schimmelfennig and Sedelmeier (2004) argue that candidates adopted EU rules when the conditions were clear, when the reward of membership was credible and large, and when the domestic costs of adoption were manageable. The framework is well supported by the 2004 enlargement and is directly about accession. It will anchor the paper's detailed account of how a country joins the European Union, from application and candidate status through the negotiating chapters to ratification, and will contrast that demanding process with the lighter accession terms of most free trade areas.

Closing Note

These eight sources, with Lynch (2010), cover both halves of the planned paper. Freund and Ornelas (2010), Mansfield and Milner (1999) and Baldwin and Jaimovich (2012) will frame why agreements exist and spread; Baier and Bergstrand (2007), Kohl et al. (2016) and Dür et al. (2014) will support the survey of what agreements do; and Schimmelfennig and Sedelmeier (2004) and Campos et al. (2019) will carry the section on joining. The gap to fill before the outline is a source on accession to a free trade area outside Europe, such as the Pacific-wide agreement's process for new members.