The Application of the National Production Function (NP-Function) in the Analysis of Regional Trade Agreements

Abstract

This paper is interested to show an alternative methodological approach to evaluate regional trade agreements under the application of the National Production Function (NP-Function). The main idea is to find each national production function for each country member interested to join into a regional trade agreement. To build the national production function by country, we request to measure four sub-production functions that represent the agriculture, industrial, manufacturing and service sector. The measure of the four sub-production functions can facilitate the final specialization of each country in the same regional trade agreement. Finally, this paper presents the regional production function to evaluate the performance of the regional trade agreements before and after its implementation.

Keywords: Econographicology, regional integration and policy modeling

JEL Classification: F15