Using an endogenous preferential trade agreement (PTA) formation model, we examine the effects of continual reduction in tariff bindings on the extent of PTA formation and its role in attaining global free trade. When countries are completely symmetric, no country has an incentive to free ride from global free trade while exclusion incentives arise when tariff bindings are sufficiently tight. Due to the relatively flexible nature of the free trade area (FTA) formation, such exclusion incentives go unexercised and free trade always obtains as the coalition-proof Nash equilibrium (CPNE) of the FTA game. However, since customs union (CU) expansion leads directly to global free trade and member countries are able to veto CU expansion, they exercise the exclusion incentive and thus free trade fails to be a CPNE. We then consider a scenario where countries are asymmetric with respect to their comparative advantage. The country with a weaker comparative advantage has an incentive to free ride on trade liberalization of the other two countries and lower tariff bindings discipline this incentive via constraining the ability to set optimal tariffs. As a result, continual reduction in tariff bindings facilitates FTA formation in attaining global free trade.

使用内生的优惠贸易协定（PTA）形成模型，我们研究了关税约束的持续减少对PTA形成程度及其在实现全球自由贸易中的作用的影响。当国家完全对称时，没有任何国家会鼓励他们摆脱全球自由贸易，而当关税约束足够严格时就会出现排斥性刺激。由于自由贸易区（FTA）形成的相对灵活的性质，这种排他性激励措施得不到执行，自由贸易总是作为FTA博弈的抗联盟纳什均衡（CPNE）获得。但是，由于关税同盟的扩张直接导致全球自由贸易，而成员国有能力否决CU的扩张，因此他们实行排斥激励，因此自由贸易不能成为CPNE。然后，我们考虑一种情况，即各国在其相对优势方面不对称。比较优势较弱的国家有动机乘搭其他两个国家的贸易自由化，而较低的关税约束则通过限制设定最优关税的能力来约束这种激励措施。结果，关税约束的持续减少促进了自由贸易协定的形成，以实现全球自由贸易。