Methodology for Estimating the Economic Impact of a Free Trade Agreement on ASEAN Countries - Case Study

Download or read book Methodology for Estimating the Economic Impact of a Free Trade Agreement on ASEAN Countries - Case Study written by Tai Huu Pham and published by . This book was released on 2018 with total page 310 pages. Available in PDF, EPUB and Kindle. Book excerpt: Abstract: "Some ASEAN nations are experiencing a rapid proliferation of Free Trade Agreements (FTAs) and Regional Trade Arrangements (RTAs). These FTAs and RTAs are creating a potentially confusing "noodle bowl" scenario. Therefore, their economic effects need to be estimated by rigorous impact assessments. They particularly need to be evaluated as a testing ground for the ASEAN Economic Community (AEC) that came into effect in 2015. However, discovering and understanding appropriate models for impact assessment is not a straightforward problem. Developed countries usually use Computable General Equilibrium (CGE) Models and Gravity Models to estimate the future or past economic effects of FTAs and RTAs. These models assume a stable market economy with prices set by the equilibrium between supply and demand. However, some ASEAN countries, including Vietnam, are still in transition to market economies. For such economies, we argue that CGEs must be supplemented by Input-Output Models, which do not require this assumption. In addition, because CGE models are sensitive to missing or incorrect data, it is difficult to find enough reliable data to construct a CGE or Partial CGE Model for some ASEAN countries. This thesis investigates two research questions on estimating the economic effects of an FTA or RTA on a developing country."