Decomposing the Economic Costs and Benefits of Accession to the EU: the Swiss Case

Grether, Jean-Marie; Müller, Tobias

doi:2001.16.2.203

Journal of Economic Integration 2001 June;16(2) :203-228.
DOI: https://doi.org/10.11130/jei.2001.16.2.203

Decomposing the Economic Costs and Benefits of Accession to the EU: the Swiss Case

Jean-Marie Grether, Tobias Müller

University of Geneva

ABSTRACT

This paper proposes a decomposition of the likely effects of a "deep" regional integration arrangement for a small country. It is based on a steady-state general equilibrium model which allows to capture the long-term effects of a variety of factors, including the reduction of non-tariff barriers, immigration, budgetary transfers and monetary integration. Particular care is given to the modeling of wealth accumulation, with savings endogenized on the basis of an overlapping generation framework. The effects of product standardization in manufacturing are simulated on the basis of ex-post estimates of the pro-competitive effects of the Single Market Program.

Keywords: Regional Integration | Applied General Equilibrium