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This paper reviews the most significant recent developments in the theory of trade agreements. The paper offers an integrated approach to evaluating trade agreements, and uses the approach to present results on preferential and multilateral trade agreements. The paper identifies also several questions for further research. The topic of trade agreements is a broad one. The authors will define trade agreements as agreements concerning nations' treatment of goods, services, or factors of production as these cross borders or have the potential of affecting the economic welfare of foreign nationals.
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