All welfare effects of a regional trading agreement are static.

Question

Quizplus · Accepted Answer

The welfare effects of a regional trading agreement can be dynamic, evolving over time as trade flows and market conditions change. For example, new industries may emerge or existing ones may decline, leading to changes in employment, wages, and profits. Additionally, changes in technology, transportation, and communication can affect the competitiveness of different regions and alter the patterns of trade. Therefore, the welfare effects of a regional trading agreement are not necessarily static but can be subject to ongoing adjustments and adaptations.

All Welfare Effects of a Regional Trading Agreement Are Static