The effects of the formation of regional trade blocs on international trade could b interpreted in 2ways.?!?
Answer:
on the one hand regional trading blocks are indeed benefitial because these regions include poorer nations that benefit from these unions for example mexico has benefited greatly through NAFTA and countries like Ireland Spain Greece and Portugal have definately reaped the benefits of being in teh EU.
however countries outside the union often suffer due to these blocks because trade is diverted away from them to countries within the union.
the links below might help you with some more detailed research on the topic.
I would view it as the latter. This is an important question given the recent, complete collapse of the Doha trade talks in Potsdam. Many nations, particularly members of APEC are now moving the focus towards bilateral/regional trade talks as an alternative.
The main hurdle in multinational trade talks is the agricultural supports in developed nations and the non-agricultural market access issues in developing nations. To the extent that regional trade negotiations are achieved and reduce these protections, the opposition to their further removal will shrink. That is, bilateral or regional trade agreements will lower the rents received by protected groups, reducing their future incentives to oppose the next attempt at multilateral talks.
... at least, that's my hope.
this is true. After signing regional agreements the access to cheaper goods for consumers are realized. After that throwing up boundaries around the bloc does not hurt consumers as much since access to the regional bloc's factors of production is already realized. It could lead to more protectonism toward countries outside the bloc but we haven't seen this
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