The Zollverein and the Sequence of a Customs Union

The Z ollverein was the first international customs union, essentially defining these particular trade agreements. This article utilizes the predictions of a game theoretic model to explain the observed sequence of accessions into this union. Coalition externalities, the effects the accession of one state has on states remaining on the outside, are the central mechanisms shaping the negotiations between Prussia, the agenda setter, and other G erman states. This is demonstrated by detailing these financial, strategic, and political externalities, and demonstrating their influence on trade policy decisions.