Working Paper: CEPR ID: DP5423
Authors: Olivier Accominotti; Marc Flandreau
Abstract: Textbook accounts of the Anglo-French trade agreement of 1860 argue that it heralded the beginning of a liberal trading order. This alleged success has much interest from a policy point of view: unlike modern GATT/WTO multilateral agreements, it rested on bilateral negotiations. But, in reality, how great were its effects? With the help of new data on international trade we provide empirical evidence. We find that the Anglo-French treaty and subsequent network of Most Favoured Nation (MFN) trade agreements coincided with the end of a period of unilateral liberalization across the world, and that it did not contribute to expand trade at all. This is contrary to a deeply rooted belief among economists and economic historians. We conclude that, contrary to a popular wisdom, bilateralism did not promote trade in the 19th century.
Keywords: Anglo-French Treaty; Bilateralism; Liberalization; MFN; Multilateralism; Trade Policy
JEL Codes: F31; N32
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Anglo-French treaty of 1860 (N43) | Britain's imports from France (N73) |
| Anglo-French treaty of 1860 (N43) | trade expansion (F10) |
| Anglo-French treaty of 1860 (N43) | trade patterns (F10) |
| bilateral treaties (F55) | overall trade expansion (F10) |
| Anglo-French treaty of 1860 (N43) | trade with non-signatories (F10) |