Gain from regional trade integration : the case of the Arab countries

Abstract EN

Despite the recent increasing research focus on the impact of regional trade integration on economic development, which has been spurred by the improvement of existing regional trade relationship and the introduction of new regional economic cooperation schemes, few quantitative studies on the magnitudes of the efficiency effect of trade integration have been conducted.

The current study extends the existing literature by providing a quantitative measure of the efficiency effect of regional integration in the Arab World.

The paper studies the effect of regional trade integration in the context of a neoclassical production function.

The empirical results suggest, ceteris paribus, that Arab countries can improve the technical efficiency of their physical stocks and human assets by approximately 14 percent simply by promoting regional trade integration among the countries in the region.