An analysis of Central America and Eastern Europe Revealed Comparative Advantages
Publication Name:
Journal of Eastern European and Central Asian Research (JEECAR)
Volume, number, page:
1:1, pp.1-12
Year of Publication:
2014
Organization Name:
Institute of Eastern Europe and Central Asia
Acronym:
IEECA
Publisher:
IEECA Society
City:
Minneapolis
Country of Publication:
United States
Full Date:
2014
ISBN or ISSN:
2328-8280
Considered Countries:
Guatemala
Honduras
Nicaragua
El Salvador
Costa Rica
Panama
Category:
Academic articles
Theme:
Subregion - European Union
Agreements
Association Agreeements
Strategic Partnerships
Government
Business
Keyword(s):
Foreign economy
Central American Common Market
Free market economies
Caribbean
Balassa Index
Free Trade
Central America
FTA
Free Trade Agreements
ODECA
Commercial policy
Foreign economic policy
Financial markets
Financial instruments
Abstract:
The present study applies the revealed comparative advantages through the Balassa Index to determine the comparative advantages, disadvantages, and intra-product commerce tendencies between Central America and Eastern Europe with the purpose of determining the possibility of a free trade agreement for Central America. The approach of the study is through the connection between the European Economic Union and the Central American Common market, which shares a common background and relates them to research of Bela Balassa (1965) to determine how commerce between Central America and Eastern Europe has performed and the possibilities of growth that this commerce has through a free trade agreement. The study demonstrates the importance of analyzing competitive advantages. This paper presents the difference in competitive advantage between Eastern Europe and Central American establishing the benefits when negotiating a free trade agreement between both economic blocks. Therefore, analyzing and negotiating between products of competitive advantages may lead to a more sustainable economic growth.
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