Implications of NAFTA, TLCUEM, and the integration of China into the WTO on the eggplant world market: A spatial equilibrium perspective

Ramón Guajardo, Maricela Ríos

Abstract

This paper studies the impact on the eggplant world market caused by NAFTA, TLCUEM and by the integration of China into the WTO. The impacts were measured as changes on commercial flows and prices. A spatial equilibrium model with endogenous prices was specified and estimated from which alternative scenarios were considered: with and without the operation of these treaties and the incorporation of China into the WTO. The results show that the operation of these treaties results in trade diversion. Furthermore, under the integration of China into the WTO, even under free world trade market there is no impact on the eggplant world market.

Keywords

Spatial equilibrium model; Eggplant market; Quadratic programming; Free trade

Subject classification

C6, D4, F1, N5.

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