Applied general equilibrium (AGE) models have received considerable attention and scrutiny in the public debate over the North American Free Trade Agreement (NAFTA). This collection brings together the leading AGE models that have been constructed to analyse NAFTA. A variety of approaches to modelling trade liberalization are taken in these studies, including multi-country and multi-sectoral models, models that focus on institutional features of particular sectors (agricultural, autos, steel, textiles and apparel) affecting multinational firms and rules of origin, and models with some inter-temporal structure. Further, by constructing stylized models, theoretical linkages have been identified that drive numerical results in the larger AGE models. The volume also assesses what can be learned about the likely economic effects of NAFTA from the collection of studies taken as a whole. Areas in need of further study have been highlighted.
Part I. Introduction: 1. Age models of North American free trade: an introduction Joseph F. Francois and Clinton R. Shiells; Part II. Multisector Models: 2. A general equilibrium analysis of North American economic integration David W. Roland-Holst, Kenneth A. Reinert, and Clinton R. Shiells; 3. The gains for Mexico from a North American free trade agreement - an applied general equilibrium assessment; 4. Some applied general equilibrium estimates of the impact of a North American free trade area on Canada David J. Cox; 5. Properties of applied general equilibrium trade models with monopolistic competition and foreign direct investment Drusilla K. Brown; Part III. Sector-Focused Models: 6. Agriculture in the Mexico-US free trade agreement: a general equilibrium analysis Santiago Levy and Sweder van Wijnbergen; 7. Wage changes in a U.S.-Mexico free trade area: migration versus Stolper-Samuelson effects Mary E. Burfisher, Sherman Robinson and Karen E. Thierfelder; 8. The auto industry and the North American free-trade agreement Florencio Lopez-de-Silanes, James R. Markusen and Thomas F. Rutherford; 9. Bilateral trade liberalization in quota restricted items: U.S. and Mexico in textiles and steel Irene Trela and John Whalley; Part IV. Dynamic Models: 10. A dynamic dual model of the North American free trade agreement Leslie Young and Jose Romero; 11. Towards a dynamic general equilibrium model of North American trade Timothy J. Kehoe