DP836 Liberalizing EC Imports of Footwear from Eastern Europe

Author(s):	Zhen Kun Wang, L. Alan Winters
Publication Date:	September 1993
Keyword(s):	Eastern Europe, EC, Europe Agreements, Footwear, Quantitative Restrictions, Trade Liberalization
JEL(s):	F13, F15
Programme Areas:	International Trade and Regional Economics
Link to this Page:	cepr.org/active/publications/discussion_papers/dp.php?dpno=836

We present a simple computable model of EC footwear production and trade coupled with a rudimentary production model for Eastern Europe. We simulate the liberalization of EC footwear imports from Eastern Europe as planned under the so-called Europe Agreements. We find that if Eastern Europe can improve its productivity modestly both East and West can gain significantly from liberalization. These gains are concentrated on the EC-North, however, while the major footwear producing areas of the EC lose. The benefits of liberalization to Eastern Europe do not depend strongly on their gaining preferential access to the EC -- they persist even if all suppliers to the EC have free access.