Abstract:

According to the World Trade Organization, regional trade agreements (RTAs) are a key factor in international trade relations. Over the years, RTAs have not only become more numerous, but also broader and more complex. The analysis of RTAs from a macroeconomic perspective improves understanding of the impact they have on the multilateral trading system as a whole.

Bringing this analysis to students of university from the subject of world economics is fundamental, because the European Union is currently the trading bloc with the largest number of RTAs worldwide and within the multilateral trading system. This paper presents a new approach to the Kaldor Macroeconomic Square methodology, adapted to analyze the economies of the countries that make up an RTAs. This methodology tool traditionally facilitates the simultaneous analysis of macroeconomic variables such as productive capacity, the evolution of prices and the labor market, and the volume of trade in an economy. These variables are related to the objectives of economic growth, price stability, full employment and trade balance of the economies analyzed.

Moreover, this methodology is versatile, it can be adapted to different analysis environments, facilitating the comparison of economies, their temporal evolution, macroeconomics and even incorporating analysis of specific productive sectors at the microeconomic level.

Students can analyze the different configurations of the polygon obtained through the Kaldor square methodology and can interpret the situation of equilibrium between the economies that make up an RTA, or the preponderance of some of them. Also, together with a temporal analysis, it can determine the economic improvement, stagnation or regression following the implementation of an RTA, especially in members with more fragile economies.

Keywords:

Kaldor's square, macroeconomic variables, regional trade agreements (RTA).