Assessing the Enlargement and Deepening of the European Union

2008

This paper estimates a theoreticallymotivated gravity model to examine the effect of the European Union (EU) on trade and whet her the order of entry has affected the trade performance of member countries. Additionally, we analyse the impact of the diffe rent phases of EU integration on trade. The results show that both original countries and successive enlargements boost intra-b loc trade. Moreover, the results suggest that the deepening in the integration process has led to more trade creation among members. Finally, only the latter ph ase of the European integration process (the single currency) has increased trade with non-members.