THE UNITED-STATES CANADA FREE-TRADE AGREEMENT AND COMMODITY TRANSPORTATION SERVICES AMONG UNITED-STATES STATES

The Free Trade Agreement (FTA) implemented beginning in 1989 by the United States and Canada will have significant impacts on bilateral trading patterns. In addition to its long-term, investment-related repercussions, the FTA will affect the volume, commodity composition, and spatial distribution of trade and, consequently, the transportation services required to move commodities between the two nations. This paper examines the changing spatial structure of U.S.-Canadian trade under the FTA. It employs commodity-specific analyses of tariffs and non-tariff barriers. as well as price and income elasticities of demand. to estimate sectoral and spatial changes among U.S. states in total, land, water, and airborne commodity flows since 1988 attributable to the FTA. The analysis details die assumptions and methodology used, elaborates upon the likely consequences for the nation's ten largest customs districts, particularly New York, and concludes with some comments on other forces that may alter the expected results.