Dynamic Evolution of the Power Structure and Contracting State Status in the Regional Trade Agreement Network and Its Trade Feedback Effects

Abstract

ABSTRACT Against the backdrop of the serious setback in WTO multilateral negotiations, countries around the world have signed a large number of regional trade agreements (RTAs) to further reduce trade barriers and promote trade liberalization. These RTAs have formed a complex network of crisscrossing and mutually reinforcing dependencies that reshape the trade effects of individual RTAs. This paper uses the complex network analysis method to discuss the construction and development issues of RTAs among countries around the world and reveals the historical changes in the power structure of the economic and trade rules network and the dynamic evolution of the network status of core countries in international trade since 1995. Based on this, the feedback mechanism of the overall structure of the network and the node country status on the trade effect of RTAs is explored and tested. The analysis results show the following: (1) The global RTA network follows a power law distribution, the unbalanced characteristics of bipolarization in international economic and trade rules are very significant, and the gap in national network status is enormous. European countries are almost always in the center of the network, and China’s network status has not improved significantly. (2) The network shows obvious competitive and balancing relationships, and the pattern of international economic and trade rules has a trend toward short-term multi-polarization. (3) The test results of the trade effect feedback mechanism of the network show that the redundancy relationship of the overall network and the concentration of power structure have a negative influence on the trade effect of RTAs, while the bridging cluster function and transitivity of the overall network have a positive feedback effect on the trade effect of RTAs. The core position and control of a single country in the network form a positive feedback and high return on the trade effect of RTAs.