to apply to imports from outside the PTA not increase as a result of PTA formation.

For decades during the post-World War II period, much of the analysis of PTAs centered primarily on one successful experience of regional integration - i.e., the continuing and ongoing evolution of western Europe. The 1951 Treaty of Paris established the European Coal and Steel Community (ECSC) which was expanded with the 1957 Treaty of Rome to create the six-country European Economic Community (EEC). Today’s EU is the result of continued integration over the subsequent ...ve decades, including numerous country accessions (28 member countries, as of 2015) as well as substantial “deepening” of negotiations and agreements beyond trade preferences and toward factor market, economic, monetary, and even political integration.

Beginning in the late 1980s, a number of other potentially economically meaningful PTAs arose that have subsequently been sustained. These include the 1987 CUSFTA (Canada-US Free Trade Agreement) that was subsequently expanded into the NAFTA (North American Free Trade Agreement) through the addition of Mexico in 1994. There are also increasingly important developing country PTAs, including the MERCOSUR (Mercado Común del Sur) customs union involving Argentina, Brazil, Paraguay and Uruguay in the early 1990s, ASEAN (Association of Southeast Asian Nations) Free Trade Area involving Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand in the early 1990s, and CAFTA-DR (Central American Free Trade Area – Dominican Republic) involving the US and ...ve Central American economies in the mid-2000s. As of 2014, the WTO reports that it has been noti...ed of nearly 600 reciprocal trade agreements in existence, and nearly 400 agreements are currently in force (WTO, 2014a).<sup>11</sup> Tari¤s and behind-the-border measures in PTAs There are two key areas in which PTAs push beyond the multilateral, WTO commitments. The ...rst is by reducing import tari¤s even lower than WTO levels, albeit on a discriminatory basis. The second is by negotiating beyond tari¤s directly over new, behind-the-border policy instruments.

WTO (2011) provides a recent and relatively comprehensive characterization of the patterns of tari¤s and trade taking place under PTAs. With the sharp increase in PTAs since 1990, the value of trade between PTA members has grown faster than the world average; not surprisingly the share of intra-PTA trade in world trade has nearly doubled from 18 percent in 1990 to 35 percent in 2008.<sup>12</sup> And when intra-EU trade ‡ows are included in these statistics, intra-PTA trade as a share of world trade increased from 28 percent to 51 percent over this period. However, the WTO (2011) data analysis, based on a matching of product-level trade ‡ows to tari¤s and preferential tari¤s to MFN tari¤s, reveals a number of other stylized facts, some of which challenge the conventional wisdom regarding the degree to which PTAs serve as a force for discriminatory tari¤ liberalization.

First, while many theoretical models typically assume PTAs result in zero applied tari¤s be-

> 11 The number of noti...cations and trade agreements in force di¤er for several reasons. One is because noti...cations include not only new agreements, but also the accession of new countries to existing agreements - e.g., Croatia’s accession to the EU in 2013. Second, some agreements noti...ed to the GATT/WTO later become “inactive” (or no longer in force), when they become superseded by a subsequent agreement that was later noti...ed and which is currently in force - e.g., CUSFTA is no longer in force as it was superseded by NAFTA.

> 12 The data reported here and below derives speci...cally from section II of WTO (2011, pp. 47-86).

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