Trade integration strategies and welfare. A comparative study of six selected Latin-American countries

Virtual

Congreso; LV Reunión Anual de la Asociación Argentina de Economía Política; 2020

Asociación Argentina de Economía Política

Latin America has historically been a region not very open to internationaltrade. However, since the early 1990s, a change in trend has beenobserved, although it was not homogeneous neither it took place at asimilar pace when comparing among countries in the region.In this paper, we estimate and compare the effects that differentpreferential trade integration strategies have had on consumer welfare,through changes in the prices of the goods and services consumed. Threechannels are identified, changes in unit values, and in the quality andvariety of the goods that are consumed.For the six countries analyzed here, which correspond to the region's maineconomies, the results show differences in the effects, both in terms oftheir magnitude and the channel through which they materialized.Argentina is the worst performer, while Mexico is at the opposite end.Except for Chile, countries that followed a more aggressive integrationpolicy show better results.