Trade Structure Effects of China-ASEAN Free Trade Area

Based on endogenous treatment and differences-in-differences methods, this paper empirically estimates the trade structure effects of China-ASEAN Free Trade Area. The results prove that it is significantly different of RTAs in East Asia to developed areas. Not only the likelihood of new RTA membership is enhanced by disparity of consumption, but also RTAs accelerates the inter-industry trade of the partners. Overall, this indicates the potential advantage of RTAs in East Asia is huge, and higher risk will come along with the process of RTAs, which means regional public goods are important.