The International Political Economy of Regionalism

Abstract

Economic regionalism has been dominated by preferential trade agreements (PTAs). Not only have their numbers surged since the end of the Cold War but also different varieties of PTAs have emerged. First, long-standing PTAs have evolved into deeper forms of economic regionalism, such as customs unions, common markets, or currency unions. Second, PTAs increasingly involve “behind-the-border” trade liberalization, such as the coordination of domestic trade-related regulatory standards. Third, many of the PTAs that were established during the past 25 years no longer only involve countries of the Global North but are formed by developing and developed countries (“North–South” PTAs) and between developing countries (“South–South” PTAs). Finally, a most recent development in economic regionalism concerns the building of so-called mega-PTAs, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTTP), the Regional Comprehensive Economic Partnership (RCEP) agreement, and the African Continental Free Trade Agreement, which combine the many pre-existing PTAs among its members. In order to explain the formation, proliferation, and evolution of these varieties of PTAs, existing international political economy (IPE) approaches have to give more credit to political factors, such as the locking-in of domestic reforms or the preservation of regional stability. Moreover, IPE scholarship should engage more systematically with diffusion research, particularly to account for the spate of deeper regionalism. Finally, “rising powers” and “emerging markets” constitute an exciting new research area for IPE. These new players differ with regard to the importance they attribute to regionalism and the ways in which they have sought to use and shape it. Identifying and explaining variations in the link between rising powers and regionalism is a key challenge for future research.