Abstract/Summary

This study advances the knowledge on regional integration and the role of integration in countries’ economic performance and development. It introduces a framework for conceptualizing the integration-growth nexus and discusses the welfare and development effects of integration. Unlike prior research, this study addresses the complex nature of regional integration and applies a multidimensional approach to measuring its growth and developmentrelated implications. Application of the concept of the depth and breadth of integration enables the analysis of the dynamic nature of regional cooperation. This thesis also introduces a special framework that enables a better understanding of integration effects on growth and development. In particular, it analyses the effects of regional integration together with the effects of alternative trade liberalization strategies. In other words, the impact of integration is tested against the effects that could result from the application of a unilateral tariff reduction. The research also considers the potential implications of combining the two liberalization strategies and explores the resulting complementarity effects. Such an approach allows the identification of the most and the least beneficial growth and development regional strategies and to design evidence-based policy recommendations. Evaluating the integration-growth nexus on the example of the Eurasian Economic Union (EAEU), the study suggests that to target a better economic performance, the EAEU countries should further develop regional cooperation and increase the convergence across policy areas. Without deepening regional integration across sectors, the EAEU members would not be able to fully benefit from regional cooperation as, in its current form, it remains a purely tradefacilitating instrument. The research also highlights that a combination of two trade liberalization strategies (regional integration and unilateral trade liberalization) could create a complementary effect for the EAEU countries and mitigate the shortcomings of regional integration. When it comes to the development effects, the study suggests that current regional arrangements have a very limited impact on the welfare level of the EAEU countries. To implement the robustness check of the research findings based the EAEU data, the study applies a panel data analysis to other integration initiatives with a comparable integration level. This approach improves the validity of the research outcomes and helps to develop both general and region-specific conclusions.