Preferential trade agreements could lead to more efficient global tariffs.
The article explores how countries can work together on trade tariffs. It looks at how forming smaller trade agreements can affect overall tariffs. The study finds that these smaller agreements can sometimes lead to lower tariffs for everyone involved. However, there are also negative effects, like making it harder to punish countries that break the rules. Overall, the impact of these smaller agreements on tariffs depends on how well countries cooperate on a larger scale.