Trade Blocs

Trade blocs are generally formed when two or more countries pursue policies of tariffreductions that are designed to increase trade between the participating countries. Most trade blocs are formed between neighboring countries; hence a positive relationship may be expected between regional blocs and geographical proximity. Contemporary trade arrangements however indicate a more complex geography of economic and noneconomic exchanges that involve both nearby and distant partners, as well as formal and informal linkages. This article seeks to describe the various spatial permutations of trade interactions highlighting in particular the forces that help drive the geographies of trade blocs.