Economic integration agreements and international trade

國立中正大學經濟學系 國際經濟學博士 學位論文 Department of Economics National Chung Cheng University Ph.D Dissertation ECONOMIC INTEGRATION AGREEMENTS AND INTERNATIONAL TRADE 指導教授: 陳偉智 博士 Advisor: Dr Chen, Wei-Chih 研 究 生: 阮詩環 Advisee: Nguyen Thi Hoang Oanh 中華民國 108 年7 月 July, 2019 i ACKNOWLEDGEMENTS To approach this step of achievement, firstly, I would like to show my gratitude to my home-country‘s government (Vietnamese government) who offered me the chance to study abroad This has been my dream since I was a child In addition, I would like to thank to the faculty members in the Economics of Department at the National Chung Cheng University for their approval so that I could have the admission to obtain the doctoral program here When I first came to our department, everything was new to me, especially the courses were very difficult To be honest, my English was not good, and I had no idea about Chinese Undoubtedly, I got into a panic actually for wondering how to pass the courses and how to adapt to the new life Dr Wang, Yu-Lin helped me not only choose the courses and to solve the academic problems but overcome my homesickness by accompanying me to somewhere or giving me some small gifts From the bottom of my heart, no words can describe my appreciation towards her kindness She also recommended Dr Chen, Wei-Chih to be my advisor afterwards I met Dr Chen when I was the third-semester student, and I became his advisee in the fourth semester A long time before I came to Taiwan, I went to a fortune teller (), saying that in my life there would be a man who very much helped me, and now I know who he is He always encourages me no matter what I and what the results look like I cannot also thank enough to Dr Chen, Ho-Chyuan, Dr Tang, Meng-Chi, Dr Liu, Wen-Hsien, and Dr Weng, Yong-Ho for serving as committee members in my final defense I am grateful for the excellent courses offered by you I remembered I once had a meeting with Dr Tang in his office to discuss the final term paper, he gave each student 30 minutes, but it took me nearly an hour My English was so bad that I could not understand what he said, so I consciously stayed longer to hear what he said ii again and again After nearly an hour, he advised me much, and I said ―Could you write down what you want me to do?‖ () He smiled and wrote one sentence in a piece of paper, then I finished the course Many thanks to Dr Tang for your patience with the student like me! I am eternally grateful to Dr Wu, Jyh-Lin, Dr Huang, Bwo-Nung, Dr Ueng, Shyh-Fang, Dr Chen, Fang-Yueh, Dr Chen, Wei-Cheng, Dr Chu, Shiou-Yen, and Dr Tseng, Fu-Min, who have not only helped me improve my academic skills but also been fruitful resources for me to learn from And I am also very thankful that other Professors in our department and the officers – Ms Yuen and Ms Huang help me with all enthusiasm and kindness in the whole time I have studied in Taiwan It has been very fortunate of me to have friends from different countries: Taiwan, Vietnam, Thailand, Swaziland, Indonesia, etc They are always beside me when I need their helps They have shared the happiness and sadness with me Last but not least, I would like to send a special thank to my parents, my family, my husband, and my children My husband, especially, has taken care of our kids and helped me all the time I have studied in Taiwan If I not have helps from him, I absolutely cannot finish my PhD degree One again, I would like to thank all the people who help me to achieve this goal, which is definitely not easy in my life Thank you so much! iii PREFACE Over thirty years, the world has witnessed a big transformation of trade relationships, the preferential trade relationships truly began The change in perception of the U.S towards the preferential relationships, which was remarked by the U.S signing a free trade agreement with Israel in 1985, is one of the four forces dragging the booming in preferential relationships some years later, from only 15 RTAs in 1980 to 461 in 2018 (WTO) However, in the debate of the first contest of the campaign in 2016, Donald Trump – the President of the United States of America criticized the development strategies that the U.S has followed during the past 30 years and longed to revise them After Donald Trump became the president, the world witnessed an extreme change in the USA‘s strategies which withdrew from the Trans-Pacific Partnerships (TPP) In the meantime, as the U.S presidential election (2016), the UK also conducted the staying or leaving the EU referendum, and it was determined to leave How will the preferential relationships change along with this move of the U.S and the UK? How is the liberalization of trade affected? And how are the trade flows affected? It is still early to assert the answers This withdrawal or termination of preferential relationships is, however, not the first time in the history and development of preferential trade agreements We use those terminating relationships to provide a partial evaluation of those events on trade flows The result shows that after the termination of a pair‘s economic integration agreement, their trade flows only increase in some years later and are driven by an extensive margin in the short run Building trade relationships during EIA incorporation period does not help the pair maintain their long-term relationship One of outstanding stylized facts in the EIAs is the difference in willingness to join the EIAs among countries, some of whom have signed many EIAs, but some others have not signed any Participating a lot of EIAs plays a role of a cushion for a iv country to sign an EIA with other countries more easily, especially in the case of small countries and large countries However, this fact possibly generates trade diversion in trade growth and in the probability of products survival This dissertation provides an evidence of the latter diversion effects of owning so many EIAs from the perspective of both exporters and importers Obviously, preferential trade agreements have accelerated the trade liberalization process although only in regional scale, trade flows in over the world increase, and the opportunities of economic integration for all countries are offered Vietnam is a small country, and over two decades ago (1995) Vietnamese GDP per capita was only 581 (2010 US$), but she was ―willing to join‖ in the preferential agreements by signing the first free trade agreement with the Association of Southeast Asian Nations (ASEAN) countries This is the milestone in Vietnamese integration process After 20 years (2015), Vietnamese GDP per capita was 1651 (2010 US$), and the opening index was 170% Especially, she has had the eight free trade agreements in force (by 2015), including six free trade agreements along with ASEAN and two bilateral trade agreements ―Jumping on the battle‖ Vietnam hopes to accelerate her trade and economic growth This dissertation also provides some evaluations on the trade effects of free trade agreements which Vietnam signed along with ASEAN and also by herself Before detailing three matters above, the dissertation provides some contents relating to preferential trade agreements that are analyzed in the literature review v TABLE OF CONTENTS CHAPTER OVERVIEWS OF TRADE AGREEMENTS 1 Trade Agreements: History and Trend of Developments 1.1 Definitions of Trade Agreements .1 1.2 History and Trend of Development 2 Type of Trade Agreements 2.1 Number of members 2.2 The Level of Cooperation The Stylized Facts of EIAs The Purposes of the EIA Formations 10 The Determinants that Affect the Formations of EIAs 12 5.1 Economic Factors 12 5.2 The Economic Political Factors 14 CHAPTER 16 LITERATURE REVIEW 16 Trend of Study 16 1.1 The Theories of EIA Effects .16 1.2 The Empirical Works 19 Endogenous Problem in Analyzing the Effects of EIAs 26 2.1 Instrumental Variables/2SLS Approach with Cross-section Data 26 2.2 Fixed Effect and First Differencing with Panel Data 28 Extensive and Intensive Margins 29 3.1 Count Method 32 3.2 Share Method 33 CHAPTER 36 THE LASTING EFFECTS OF EIAs ON TRADE 36 Introduction 36 Data and Variables 39 2.1 EIA Variables 40 2.2 Trade Variables .41 Empirical Model Specifications 42 3.1 Trade Creation of EIAs 42 3.2 The Lasting Effects of Past EIAs 43 3.3 The Short-Run and Long-Run Effects of Past EIAs 43 Estimated Results 44 Robustness Checks and Extensions 46 5.1 Multilateral Resistanceand Trade Diversion 46 5.2 Cutoffs of the Short Run and the Long Run 47 vi 5.3 Lasting Effects by the Type of Agreements 47 5.4 Lagged Explanatory Variables 48 5.5 Constructing Trade Values at the Product Level 48 Conclusion 49 CHAPTER 59 THE EFFECTS OF ASEAN EXPANSION ON 59 ASEAN’S EXPORTS TO VIETNAM 59 Introduction 59 Data and Variables 62 2.1 Data 63 2.2 Variables 63 Empirical Models and Estimate Results 64 Robustness check 74 Conclusion 75 CHAPTER 80 DIVERSION EFFECT OF ECONOMIC INTEGRATION AGREEMENTS 80 I Introduction 80 Data and Method 84 Estimate results 90 Conclusions 99 CHAPTER 101 SUMMARY AND FUTURE RESEARCHES 101 REFERENCES 104 APPENDIX 120 vii LIST OF ABBREVIATES ASEAN APEC CGE CMs CUs EC EEC EIAs EU EUs FDI FTAs GCE GATT GDP GSP HK HS IPRs IVs LDCs MFN MLI MR NAFTA OLS OWPTA PTAs RHS RoOs RTAs ROW STIC 2SLS TBT TC TD TOT TRIMs TRIPs TWPTAs UK UNCTAD VCCI VN WTO Association of Southeast Asian Nations Asia-Pacific Economic Cooperation Computable General Equilibrium Custom markets Custom Unions European Community European Economic Community Economic Integration Agreements European Union Economic Unions Foreign Direct Investments Free trade agreements General Computable Equilibrium General Agreement on Tariffs and Trade Gross domestic products Generalized Systems of Preferences Hummels and Klenow The Harmonized Commodity Description and Coding System Intellectual Property Rights Instrumental Variables Least developed countries Most favored nation Member Liberalization Index Multilateral Resistance North American Free Trade Agreements Ordinary Least Square One-way Preferential Trade Agreements Preferential trade agreements Right hand side Rules of Origin Regional trade agreements Rest of the world Standard International Trade Classification Two-Stage Least Squares Technical barriers to trade Trade creation Trade diversion Terms of Trade Trade-Related Investment Measures Trade-Related Aspects of Intellectual Property Rights Two-way Preferential Trade Agreements United Kingdom United Nations Conference on Trade and Development Vietnam Chamber of Commerce and Industry Vietnam World Trade Organization viii LIST OF FIGURES Fig.1.1 Levels of cooperation in EIAs 1962 - 2000 Fig.1.2 RTAs in force and inactive, 1948-2018 Fig.1.3 The number of an exporter's EIA partners Fig.1.4 The 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Accessions to an RTA Cumulative Notifications of RTAs in force Cumulative Number of Physical RTAs in force Source: WTO, 201827 Note: Notifications of RTAs: goods, services & accessions to an RTA are counted separately Physical RTAs: goods, services & accessions to an RTA are counted together The cumulative lines show the number of notifications/physical RTAs currently in force Fig.1.2 RTAs in force and inactive, 1948-2018 800 100 600 80 60 400 40 200 20 Cumulative Number Number per year 120 Notifications of Inactive RTAs Notifications of RTAs in force Cumulative Notifications of RTAs in force and inactive RTAs Cumulative Notifications of RTAs in force Cumulative Number of Physical RTAs in force Source: WTO28 Note: Notifications of RTAs: goods, services & accessions to an RTA are counted separately Physical RTAs: goods, services & accessions to an RTA are counted together The cumulative lines show the number of notifications/physical RTAs currently in force “Active” RTAs are still in force They produce effects on the parties and the texts of these RTAs are currently binding between them “Inactive” RTAs were concluded in the past and are no longer in force They may still appear in some statistics but they not produce any effect 27 28 RTA database are downloaded from https://rtais.wto.org/UI/PublicMaintainRTAHome.aspx Inactive RTA database are downloaded from https://rtais.wto.org/UI/PublicMaintainRTAHome.aspx 111 Frequency Fig.1.3 The number of an exporter's EIA partners 35 30 25 20 15 10 0 10 15 20 25 Freq.1980 30 35 40 Freq.1990 45 50 55 60 65 85 Number of EIA partners Freq.2000 Freq.2012 Frequency Fig.1.4 The number of an importer's EIA partners 80 70 60 50 40 30 20 10 0 Freq.1980 10 Freq.1990 15 >100 Number of EIA partners Freq.2000 112 Freq.2012 Fig.1.5 Levels of cooperation in EIAs 1962 - 2012 60,000 80 70 50,000 50 30,000 40 30 20,000 Percent Frequency 60 40,000 20 10,000 10 0 2000 CM EU Note: NRCP, PTA, FTA, CU, CM, and EU are one-way preferential trade agreements, two-way preferential trade agreements, free trade agreements, custom unions, common market, and economic union, respectively 113 Table 1.1 The Frequency and Percent of Types of EIAs Frequency OWPTAs TWPTAs FTAs 2000 52,070 18,986 22,010 4,234 5,8243,442 48.86 17.82 20.65 3.97 5.47 3.23 Note: OWPTAs, TWPTAs, FTAs, CUs, CMs, and EUs are one-way preferential trade agreements, two-way preferential trade agreements, free trade agreements, custom unions, common market, and economic union, respectively 114 Table 1.2 The 52 Provisions in Classification of EIAs in Horn et al (2010) No Variable Mean Std Dev Min Max No Variable 27 Mean Std Dev 0.02 0.2 Min Max 0.03 0.22 0.06 0.31 0.06 0.31 0.14 0.47 0.18 0.14 0.55 0.51 0 2 0.05 0.08 0.26 0.39 0 2 0.09 0.40 0 0.1 0.41 0.03 0.22 0 0 0 0 0 0.02 0.2 0.09 0.38 0.18 0.56 FTA Industrial 2 28 1.98 0.2 29 FTA Agriculture Customs 1.77 0.63 30 Export Taxes 1.28 0.96 31 SPS TBT 0.74 0.87 0.89 0.97 0 2 32 33 STE Anti-dumping CVM 0.96 1.56 1.29 0.99 0.76 0.91 0 2 34 35 36 10 11 1.09 0.78 0.97 0.96 0 2 37 38 12 State Aid Public Procurement TRIMs 0.82 0.99 39 13 14 GATS TRIPs 1.08 1.17 1.00 0.98 0 2 40 41 15 16 0.14 1.05 0.51 0.86 0 2 42 43 0.38 0.75 44 18 Anti-Corruption Competition Policy Environmental Laws IPRs 0.97 0.979 45 19 Investment 0.86 0.98 46 20 Labour Market Regulation Movement of Capital Consumer Protection Data Protection Agriculture Approximation of Legislation Audio Visual 0.38 0.76 47 Civil Protection Innovation Policies Cultural Cooperation Economic Policy Dialogue Education and Training Energy Financial Assistance Health Human Rights Illegal Immigration Illicit Drugs Industrial Cooperation Information Society Mining Money Laundering Nuclear Safety Political Dialogue Public Administration Regional Cooperation Research and Technology SME 0.14 0.45 1.14 0.99 48 Social Matters 0.25 0.66 0.14 0.49 49 Statistics 0.34 0.12 0.16 0.14 0.45 0.52 0.51 0 2 50 51 52 Taxation 0.05 Terrorism 0.02 Visa and 0.39 Asylum 0.297 0.2 0.78 0 2 0.02 0.2 17 21 22 23 24 25 26 0.06 Note: The first fourteen provisions are the current mandate of WTO; the latter provisions are outside the current mandate of the WTO Zero (0) means that the provision is not mentioned in the agreement or not legally enforceable One (1) means that the provision is mentioned, legally enforceable but explicitly excluded by dispute settlement provision Two (2) means the provision is mentioned and legally enforceable 115 1.500e+10 1.000e+10 5.000e+09 Trade volume (US.$) Fig.2 ASEAN Epxort to Vietnam 1990 1995 2000 2005 2010 Singapore Thailand Malaysia Indonesia Philippines Cambodia Myanmar Brunei Darussalam Lao People's Dem Rep 116 2015 4500 Fig.4.2 The number of products some FTA members export to VN 4000 3500 3000 2500 2000 1500 1000 500 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 AUS CHL CHN IDN IND JPN KOR MYS SGP THA 117 Table 4.1 The List of FTAs are Used in current Chapter Name of FTA ASEAN (AFTA) ASEAN-China (ACFTA) ASEAN-Korea (AKFTA) ASEAN-Japan (AJFTA) Vietnam-Japan (VJFTA) ASEAN-India (AIFTA) ASEAN-Australia-New Zealand (AANZFTA) Vietnam-Chile (VCFTA) Vietnam Type of FTA became the member 1995 Multilateral 2004 2006 2008 2009 2010 2010 Multilateral Multilateral Multilateral Bilateral Multilateral Multilateral 2012 Bilateral Members Brunei Darussalam Cambodia Singapore Thailand Malaysia Philippines Myanmar Indonesia Lao People's Dem Rep Vietnam ASEAN-China ASEAN-Rep of Korea ASEAN-Japan Vietnam-Japan ASEAN-India ASEAN-Australia-New Zealand Vietnam-Chile Source: VCCI29 Table 4.2 SITC, Rev.3 Sector Name of sector Food and live animals Beverages and tobacco Crude materials, inedible, except fuels Mineral fuels, lubricants and related materials Animal and vegetable oils, fats and waxes 29 Sector Name of sector Chemicals and related products, n.e.s Manufactured goods classified chiefly by material Machinery and transport equipment Miscellaneous manufactured articles Research Report of VCCI are downloaded from http://vcci.com.vn/ 118 Table 4.5 Total Registered Capitals of FDI by Main Counterparts (Accumulation Statistics–Mill-USD) No Country 19882005 No Country 19882012 No Country Singapore 8684.9 Japan 28699.6 Rep of Korea 45191.1 Taiwan 8303.6 Taiwan 27129.1 Japan 38973.6 Japan 6454.7 Singapore 24875.3 Singapore 35148.5 Rep of Korea 5774.9 Rep of Korea 24816.0 Taiwan 30997.4 5 British Virgin 15386.4 Islands Hong Kong SAR 11966.7 (China) United States 10507.2 British Virgin 4479.6 Islands Hong Kong SAR 4283.4 (China) France 2604.7 British Virgin 19275.3 Islands Hong Kong 15546.8 SAR (China) Malaysia 13420.1 Netherlands 2331.3 Malaysia 10196.4 United States 11301.8 United States 2124.1 Cayman Islands 7506.0 China, PR 10174.2 10 United Kingdom 1859 10 Thailand 6063.7 10 Netherlands 8264.5 11 Malaysia 1646.1 11 China, PR 4697.2 11 Thailand 7727.9 12 Thailand 1502.8 12 France 3142.7 12 6392.3 13 Fed Russian 1336 13 United Kingdom 2617.3 13 Cayman Islands Samoa 14 Australia 1310.1 14 Australia 1313.2 14 Canada 5252.7 15 Switzerland 882.3 15 Fed Russian 1056.0 15 4739.3 16 Samoa 830.7 16 F.R Germany 1053.7 16 United Kingdom France 17 Luxembourg 816.5 17 Finland 336.2 17 Fed Russian 2080.1 18 Cayman Islands 746.4 18 Indonesia 285.1 18 Switzerland 2045.1 19 China 741.7 19 Italy 257.2 19 Brunei 1904.5 20 Panama 678 20 India 251.4 20 Luxembourg 1857.4 6 19882015 5771.7 3423 (General Statistics Office of Vietnam) 119 APPENDIX Table 5.8 Marginal Effects of EIAs on the Hazard Rate of Products Ceasing VARIABLES Initial export value (ln) Duration of a product (ln) Distance (ln) Exporter‘s gdp (ln) Importer‘s gdp (ln) Common language Colony Common currency EIA_effect Spell after EIA formation Length of EIA (ln) (1) Marginal Effect (2) Marginal Effect -0.0145*** (6.15e-05) -0.137*** (0.000137) 0.0145*** (0.000149) -0.00419*** (7.37e-05) -0.00130*** (6.73e-05) -0.0100*** (0.000346) -0.0291*** (0.000557) 0.124*** (0.00102) -0.0643*** (0.000868) -0.0258*** (0.000775) 0.0346*** (0.000352) -0.0161*** (6.21e-05) -0.138*** (0.000137) 0.0152*** (0.000150) -0.00375*** (7.57e-05) -0.00377*** (6.88e-05) -0.00910*** (0.000346) -0.0303*** (0.000557) 0.131*** (0.00102) -0.0853*** (0.000861) -0.0277*** (0.000772) 0.0379*** (0.000352) 0.0544*** (0.000408) 0.0415*** (0.000325) 11,665,939 Export_outsider Import_outsider Observations 11,665,939 Note: Standard errors are in parentheses; *** Significant at 1%; ln is natural logarithm 120 Table 5.9 The marginal Effects of the “phase-time” Effect of EIA Relationships on Duration VARIABLES (1) ME (2) ME (3) ME Initial export value (ln) -0.00484*** -0.00351*** -0.00329*** (6.81e-05) (7.10e-05) (7.45e-05) Duration of a product (ln) -0.0608*** -0.0600*** -0.0630*** (0.000214) (0.000196) (0.000198) Distance (ln) 0.00934*** 0.00701*** 0.00602*** (0.000164) (0.000172) (0.000181) Exporter‘s gdp (ln) -0.00245*** 0.000203** 0.00192*** (8.59e-05) (9.08e-05) (9.69e-05) Importer‘s gdp (ln) -0.00476*** -0.00435*** -0.00379*** (7.59e-05) (7.96e-05) (8.41e-05) Common language -0.00900*** -0.00734*** -0.00675*** (0.000380) (0.000397) (0.000418) Colony -0.0265*** -0.0250*** -0.0226*** (0.000596) (0.000618) (0.000644) Common currency 0.145*** 0.155*** 0.163*** (0.00105) (0.00108) (0.00112) Export_outsider 0.0483*** 0.0445*** 0.0467*** (0.000442) (0.000471) (0.000500) Import_outsider 0.0291*** 0.0285*** 0.0294*** (0.000367) (0.000389) (0.000413) EIA_effect -0.0601*** -0.0558*** -0.0410*** (0.00131) (0.00103) (0.000922) Spell after EIA formation 0.115*** 0.0446*** -0.00474*** (0.00461) (0.00188) (0.00139) lag1EIA_effect 0.0388*** (0.00156) lag1spel_after_EIA -0.0861*** (0.00358) lag2EIA_effect 0.0476*** (0.00124) lag2spel_after_EIA -0.0386*** (0.00167) lag3EIA_effect 0.0349*** (0.00111) lag3spel_after_EIA 0.00815*** (0.00144) lag5EIA_effect lag5spel_after_EIA (4) ME (5) ME -0.00217*** (8.23e-05) -0.0674*** (0.000215) 0.00421*** (0.000204) 0.00340*** (0.000111) -0.00414*** (9.47e-05) -0.0111*** (0.000466) -0.0164*** (0.000709) 0.174*** (0.00122) 0.0477*** (0.000573) 0.0262*** (0.000472) -0.0362*** (0.000872) -0.00309*** (0.00120) -0.00135*** (0.000104) -0.0723*** (0.000270) 0.00596*** (0.000267) 0.00612*** (0.000152) -0.00360*** (0.000123) -0.00676*** (0.000594) -0.0243*** (0.000890) 0.229*** (0.00151) 0.0519*** (0.000777) 0.0163*** (0.000649) -0.0386*** (0.000967) 0.00202 (0.00123) 0.0355*** (0.00107) 0.00175 (0.00123) lag9EIA_effect lag9spel_after_EIA Observations 8,103,100 7,172,533 6,435,664 5,230,215 0.00694*** (0.00120) 0.0391*** (0.00139) 3,368,345 Note: Standard errors are in parentheses; *** Significant at 1%.; ln is natural logarithm; ME is the marginal effect 121 Table 5.10 The Marginal Effects of the Interaction Effects of Products’ Characteristics and Outsiders (1) Marginal Effect -0.0162*** (0.000180) -0.166*** (0.000499) 0.0150*** (0.000150) -0.00367*** (7.60e-05) -0.00379*** (6.88e-05) -0.00842*** (0.000346) -0.0303*** (0.000562) 0.130*** (0.00102) -0.0861*** (0.000864) -0.0167*** (0.000790) 0.0419*** (0.00275) 0.0534*** (0.000687) 0.0136*** (0.000559) 0.00550*** (0.000465) -0.00109*** (0.000163) -0.00820*** (0.00132) 0.0296*** (0.000357) 0.00154*** (0.000128) 9.43e-05 (0.00237) VARIABLES Initial export value (ln) Duration of a product (ln) Distance (ln) Exporter‘s gdp (ln) Importer‘s gdp (ln) Common language Colony Common currency EIA_effect Spell after EIA formation Length of EIA (ln) Export_outsider Import_outsider Duration*export outsider Initial value*export outsider Length of EIA*export outsider Duration*import outsider Initial value*import outsider Length of EIA*import outsider Observations 11,665,939 Note: Standard errors are in parentheses; *** Significant at 1%; ln is natural logarithm 122 Table 5.11 The Marginal Effects of the Hazard of Manufacturing and Agricultural Products Ceasing VARIABLES Initial export value (ln) Duration of a product (ln) Distance (ln) Exporter‘s gdp (ln) Importer‘s gdp (ln) Common language Colony Common currency EIA_effect Spell after EIA formation Length of EIA (ln) Export_outsider Import_outsider Observations (1) Marginal effect (2) Marginal effect -0.0152*** (7.32e-05) -0.131*** (0.000155) 0.0161*** (0.000172) -0.00400*** (9.14e-05) -0.00440*** (7.78e-05) -0.00886*** (0.000391) -0.0323*** (0.000634) 0.148*** (0.00118) -0.0844*** (0.000976) -0.0338*** (0.000873) 0.0393*** (0.000403) 0.0561*** (0.000456) 0.0440*** (0.000362) -0.0204*** (0.000148) -0.153*** (0.000346) 0.0120*** (0.000353) -0.000157 (0.000164) -0.00163*** (0.000172) -0.0108*** (0.000849) -0.0267*** (0.00137) 0.0823*** (0.00235) -0.0925*** (0.00209) -0.00452** (0.00188) 0.0328*** (0.000838) 0.0537*** (0.00105) 0.0336*** (0.000830) 9,152,772 1,874,353 Note: Standard errors are in parentheses; ***Significant at 1%; ln is natural logarithm 123 ... Trade Agreements Ordinary Least Square One-way Preferential Trade Agreements Preferential trade agreements Right hand side Rules of Origin Regional trade agreements Rest of the world Standard International. .. US$), and the opening index was 170% Especially, she has had the eight free trade agreements in force (by 2015), including six free trade agreements along with ASEAN and two bilateral trade agreements. .. …………………………………….……… 123 xi CHAPTER OVERVIEWS OF TRADE AGREEMENTS Trade Agreements: History and Trend of Developments 1.1 Definitions of Trade Agreements The creation of the World Trade Organization (WTO) in 1995