The Impact of NAFTA on California Exports.

This study conducts an examination of the North American Free Trade Agreement's (NAFTA) impact on California's export levels to Mexico and Canada while holding constant other variables that explain a state's exports to other nations, such as exchange rates and relative income growth. Transformed weighted least squares equations over a sample period between 1988 and 1997 are used to show that California's exports to Canada were not significantly affected by NAFTA, while exports to Mexico increased, on average, a statistically significant 16.11 percent between 1994 and 1997. The model also suggests that NAFTA's impact on California's exports to Mexico has increased over time from a 10.0 percent increase in 1994 to a 21.8 percent increase by 1997. (JEL F13, F14) [ABSTRACT FROM AUTHOR]