Regional content requirements and market power: Lessons from CUSFTA

IF 4 1区经济学 Q1 ECONOMICS

Journal of International Economics Pub Date : 2025-05-15 DOI:10.1016/j.jinteco.2025.104097

Wanyu Chung , Carlo Perroni

引用次数: 0

Abstract

Focusing on the 1989 Canada-United States Free Trade Agreement (CUSFTA), we examine how regional content requirements in Free Trade Areas (FTAs) affect competition and prices in intermediate goods markets. Content requirements in FTAs shelter firms from competition more than an equivalent trade-protection tariff would. We document patterns in US industry-level census data and Canadian product-level export data that align with theoretical predictions: stricter and binding content requirements are linked to higher prices and more firm entry. These results underscore the role of content requirements in shaping market structure and market power, with implications for the choice of preferential trade arrangements.

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区域内容要求与市场力量：中美自贸协定的经验教训

以1989年加拿大-美国自由贸易协定（CUSFTA）为例，我们研究了自由贸易区（fta）的区域含量要求如何影响中间产品市场的竞争和价格。自由贸易协定中的内容要求比同等的贸易保护关税更能保护公司免受竞争。我们在美国行业层面的人口普查数据和加拿大产品层面的出口数据中记录了与理论预测一致的模式：更严格和有约束力的内容要求与更高的价格和更多的公司进入相关联。这些结果强调了内容要求在形成市场结构和市场力量方面的作用，对选择优惠贸易安排有影响。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Journal of International Economics ECONOMICS-

CiteScore

5.80

自引率

6.10%

发文量

期刊介绍： The Journal of International Economics is intended to serve as the primary outlet for theoretical and empirical research in all areas of international economics. These include, but are not limited to the following: trade patterns, commercial policy; international institutions; exchange rates; open economy macroeconomics; international finance; international factor mobility. The Journal especially encourages the submission of articles which are empirical in nature, or deal with issues of open economy macroeconomics and international finance. Theoretical work submitted to the Journal should be original in its motivation or modelling structure. Empirical analysis should be based on a theoretical framework, and should be capable of replication.