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Trada Patterns in Eastern Europe: The Impact of Distance and the Customs Union Effect
Jönköping University, Jönköping International Business School, JIBS, Economics.
2010 (English)Independent thesis Advanced level (degree of Master (One Year)), 10 credits / 15 HE creditsStudent thesis
Abstract [en]

In 2004 the EU faced its most extensive enlargement ever when ten new countries joined. One can speculate about the reasons for these countries to join the EU and one suggestion that is often found is the access to a larger market and the trade possibilities that would entail; the customs union effect. Therefore this thesis sets out to investigate whether this is plausible; do countries trade more with the EU-countries than their non-EU neighbours? The investigation is conducted through the use of a gravity model. It investigates not only the traditional GDP and distance variables, but also the effects on trade flows caused by sharing borders, being part of the EU and sharing a language. The results show that not much could be seen in the trade flows in 2004; the year of accession. This could be attributed to the existence of preferential trade agreements, which the Eastern European countries had with the EU prior to their accession. It was also found that both the effect of sharing a language and the effect of increased distance are diminishing over the years. In addition a clear difference could be seen in the export from Eastern Europe to EU 15 and the rest of the world; it seems that some extra variables need to be added to explain the non-EU trade. Thus it can be concluded that the motivation for joining the EU should not have been the increased trade possibilities, but rather other factors such as regional development and the possibility to being part of a larger power at international negotiations.

Place, publisher, year, edition, pages
2010.
National Category
Economics
Identifiers
URN: urn:nbn:se:hj:diva-12828OAI: oai:DiVA.org:hj-12828DiVA: diva2:332128
Uppsok
Social and Behavioural Science, Law
Supervisors
Available from: 2010-08-23 Created: 2010-08-02 Last updated: 2010-08-23Bibliographically approved

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CiteExportLink to record
Permanent link

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Citation style
  • apa
  • harvard1
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
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