Do We Really Know That the WTO Increases Trade? Reply
Economic Review 2004.I used a bilateral "gravity" model of trade and showed that dummy variables for membership by either one or two countries in the GATT had only small effects on trade.In essence, TGR point out that a lot of countries were not formal members of the GATT but still participated in it as colonies, de facto, or provisional members.TGR argue that if one includes these other types of more informal membership, you get large positive effects.