This paper quantifies the effects of two regional integration agreements in Latin

America, namely the Latin American Integration Association and the Southern

Common Market, on the development of production networks in the region. Two

main hypotheses are tested using disaggregated data for trade in goods between

eleven LAIA members over the period 1991-2008. First, with trade liberalisation

LA countries have become more integrated into regional production networks

and second, the implementation of LA agreements has had production relocation

consequences. The main results indicate some evidence of production networks

mainly in the 1990s and for Mercosur members, but no significant evidence is

found from 2000 onwards.