Economic integration without policy coordination: The case of Mercosur

Werner Baer, Tiago Cavalcanti, Peri Silva

Research output: Contribution to journalArticlepeer-review


This paper analyses the evolution of the South American Common Market, Mercosur. We show how the lack of coordination of macroeconomic policies, especially of the two major participants (Argentina and Brazil), had caused trade strains. Divergent macro-economic policies have had negative effects on bilateral trade due to the risk averseness (resulting from bilateral exchange rate volatilities) of exporters and importers, and due to the protectionist forces they have brought forth.

Original languageEnglish (US)
Pages (from-to)269-291
Number of pages23
JournalEmerging Markets Review
Issue number3
StatePublished - Sep 1 2002


  • Exchange rate volatility
  • Protectionist policies
  • Trade

ASJC Scopus subject areas

  • Business and International Management
  • Economics and Econometrics


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