Assessing the trade impact of the European Neighbourhood Policy on the EU-MED Free Trade Area

Abstract

The European Neighbourhood Policy (ENP) set an additional objective for the\ud 10 Southern Mediterranean Countries (SMCs): the prospect of ‘a stake in the\ud internal market’. The launch of this new policy has been the occasion for a\ud revival of empirical studies aimed at assessing the impact of the EU-MED\ud partnership on bilateral trade. The novelty of this work is twofold: (i) to\ud present nonparametric matching estimators besides gravity estimates; (ii) to\ud 15 assume as a counterfactual of the treatment the ex-post long-run average treatment\ud effects of the Europe Agreements. By controlling for likely selection bias\ud and country and time heterogeneity, using both qualitative and quantitative\ud measures of the policy variable, we assess ex-post the trade-enhancing impact\ud of the EU preferential agreements towards SMCs and ex ante the actual efficacy\ud 20 of the ENP

Trade Performance and Potential of North African Countries: An Application of a Stochastic Frontier Gravity Model

“…This result is also found byMontalbano and Nenci (2014), who use matching econometrics to estimate the impact of FTA because of its potential endogeneity. 7 Using a gravity approach, UNECA (2013) finds that the intra-regional trade potential is far from being achieved and the observed flows represent only 46% of the predictions.…”

Trade Effects of the EU–South Korea Free Trade Agreement in the Automotive Industry

“…Meanwhile, changes in trade flows after signing FTAs with South Africa or Jordan proved to be statistically insignificant. Studies about the results of the EU Neighborhood Policy show substantial positive trade effects with the Eastern Partnership states (Gylfason et al 2015) while the results remain more modest and mixed with Mediterranean partners (Montalbano andNenci 2014, Cieslik andHamejer 2009).…”

“…The works by Rose (2004), Subramanian and Wei (2007), and Baier and Bergstrand (2007) represent some of the most noteworthy examples of papers that have spurred academic discussion about the results of trade liberalization. The gravity model has also been used for assessing the impact of EU trade policy by Bergstrand et al (2011) and Montalbano and Nenci (2014). At a sectorial level, several studies have focused on agricultural or food trade (Vollrath et al 2009, Jean and Bureau 2016, Mujahid and Kalkuhl 2016.…”

Assessing the impact of unilateral trade policies EBA and AGOA on African beneficiaries' exports using matching econometrics

“…The ATE is the average of the ATT and the average treatment effect on untreated (ATU). For the ex‐post estimates of ATE, there are two main approaches in the impact analysis of trade policy (Montalbano & Nenci, ): the “ in ‐sample” estimates that only include the countries under consideration (e.g. by using a fixed‐effects method) or the “ out ‐of‐sample” estimates that imply a comparison with a counterfactual situation (e.g.…”

“…sum of logs of GDPs; and log of distance) that can be used to generate matched untreated country pairs that are statistically indistinguishable from treated pairs (cf., e.g. Baghdadi et al, ; Baier & Bergstrand, ; Montalbano & Nenci, ). However, our study only focuses on one‐way PTAs (unilateral preferential policies), separately assessing each NRPTA (AGOA and EBA).…”