Brazil and India: two BRICs as a building bloc for South-South cooperation""

Includes Bibliography

Latin America and Asia Pacific trade and investment relations at a time of international financial crisis

Includes Bibliography

Nominal anchors and macroeconomic coordination options in MERCOSUR

Includes bibliography

Social and economic problems in Cuba during the crisis and subsequent recovery

Includes bibliography

Internationalization and technology in MERCOSUR

Includes bibliography

Global economic developments, 1999

Includes bibliography

Exports from the Brazilian automotive sector to the Southern Common Market: Trade diversion or cost reduction?

The automotive sector is one of the sectors in which trade between mercosur countries has grown most strongly. This article examines the possibility that trade diversion occurred in that sector during the period 1991-2010, assuming that product costs fell as a result of market expansion. The analysis is based on the concepts of “cost reduction” and “trade suppression” coined by Corden (1972), which capture the effects of economies of scale. Indices of regional orientation and revealed comparative advantages are used in combination to assess whether the trade bloc is evolving in line with comparative advantages. The results suggest efficiency gains for automotive-sector products, exports of which from Brazil to mercosur grew more vigorously because the expanded and relatively protected market made it possible to exploit the economies of scale that are characteristic of the automotive industry.