Reciprocal vs nonreciprocal trade agreements: Which have been best to promote exports?

Abstract

The Doha Development Agenda recognizes the central role that international trade can play in the promotion of economic development. In fact, the increase of exports from developing countries to developed nations' markets has been considered a key element for developing countries to realize the potential benefits of globalization. Over the last decades, developed countries have provided preferential access to their markets to developing countries through nonreciprocal trade agreements. Moreover, developing countries have also participated in reciprocal trade agreements. This paper re-examines comparatively the effect of both kinds of trade agreements on exports from developing countries but also from the developed world. In line with other studies, our results across specifications are unstable. However, the results of our preferred specification give additional support to the argument raised by critics of nonreciprocal preference regimes who consider that developing countries should abandon their reliance on one-way trade preferences in favor of reciprocal agreements.