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Showing posts with the label free trade zones

Free Trade Agreements and the Development of Super Hubs

Economic development is a major concern for regions and nations. Having a model to map how Free Trade Agreements work together is important for creating better policy. The authors Chong & Hur (2006) discuss how hub and spoke models can be used to see these relationships. They furthermore move into who receives the greatest economic advantage in such models under certain conditions. The information can be added into existing research on the dynamic value creation that occurs within economic hubs.  The far majority of regional trade agreements (RTA) are actually Free Trade Agreements (FTA) whereby tariffs, restrictions, quotas, and preferences on many of the products exchanged between two countries. When two countries seek to enhance their economic strength by mutually working together they may sign FTA agreements based on finding a chain of production. This may require the updating of technology to ensure that products are tracked.  The hub and spoke model (HAS) allow