Implicit Trade Costs and European Single Market Enlargement

Terence Huw Edwards (1)

1 Dept of Economics

This paper investigates the deeper integration of the new EU accession states into the Single Market. Building on the assumption that observed trade patterns can be taken to reveal trading costs between members and non-members of a bloc, I develop a model-consistent Dixit-Stiglitz general equilibrium-based calibration technique. Using this, I investigate numerically the effects of the recent EU enlargement, suggesting that deeper integration, which removed the border costs implied by 1990s trade patterns, could raise trade by 50-100% and incomes in the accession states by 10-20%.

Mots clés: Social Sciences & Humanities

Terence Huw Edwards. Implicit Trade Costs and European Single Market Enlargement. Applied Economics, 2008, 40 (20), pp.2601-2613. ⟨10.1080/00036840600970260⟩. ⟨hal-00582064⟩