|
on International Trade |
| By: | Hernán Vallejo |
| Abstract: | This paper provides a formal proof of the Factor Price Equalization Theorem within the Heckscher Ohlin model derived by Ronald W. Jones in “The Structure of Simple General Equilibrium Models” (1965), where formal proof is provided for the Heckscher Ohlin, Stolper Samuelson and Rybczynski Theorems. This paper provides a formal proof of the Factor Price Equalization Theorem within the Heckscher Ohlin model derived by Ronald W. Jones in “The Structure of Simple General Equilibrium Models” (1965), where formal proof is provided for the Heckscher Ohlin, Stolper Samuelson and Rybczynski Theorems.This paper provides a formal proof of the Factor Price Equalization Theorem within the Heckscher Ohlin model derived by Ronald W. Jones in “The Structure of Simple General Equilibrium Models” (1965), where formal proof is provided for the Heckscher Ohlin, Stolper Samuelson and Rybczynski Theorems. This paper provides a formal proof of the Factor Price Equalization Theorem within the Heckscher Ohlin model derived by Ronald W. Jones in “The Structure of Simple General Equilibrium Models” (1965), where formal proof is provided for the Heckscher Ohlin, Stolper Samuelson and Rybczynski Theorems.This paper provides a formal proof of the Factor Price Equalization Theorem within the Heckscher Ohlin model derived by Ronald W. Jones in “The Structure of Simple General Equilibrium Models” (1965), where formal proof is provided for the Heckscher Ohlin, Stolper Samuelson and Rybczynski Theorems. This paper provides a formal proof of the Factor Price Equalization Theorem within the Heckscher Ohlin model derived by Ronald W. Jones in “The Structure of Simple General Equilibrium Models” (1965), where formal proof is provided for the Heckscher Ohlin, Stolper Samuelson and Rybczynski Theorems.This paper provides a formal proof of the Factor Price Equalization Theorem within the Heckscher Ohlin model derived by Ronald W. Jones in “The Structure of Simple General Equilibrium Models” (1965), where formal proof is provided for the Heckscher Ohlin, Stolper Samuelson and Rybczynski Theorems. This paper provides a formal proof of the Factor Price Equalization Theorem within the Heckscher Ohlin model derived by Ronald W. Jones in “The Structure of Simple General Equilibrium Models” (1965), where formal proof is provided for the Heckscher Ohlin, Stolper Samuelson and Rybczynski Theorems. |
| Keywords: | International Trade |
| JEL: | F1 |
| Date: | 2004–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:col:000138:000692&r=int |
| By: | Aronsson, Thomas (Department of Economics, Umeå University); Sjögren, Tomas (Department of Economics, Umeå University) |
| Abstract: | This paper deals with optimal income and commodity taxation in an economy, where alcohol is an externality-generating consumption good. In our model, alcohol can be bought domestically, imported (via border trade) or produced illegally. Border trade implies an incentive to set the domestic alcohol tax below the marginal social damage of alcohol, and to tax (subsidize) commodities which are complementary with (substitutable for) alcohol. In addition, since leisure and alcohol consumption are generally nonseparable, the income tax will also be used as a corrective instrument. On the other hand, the desire to reduce the illegal production may generally affect the optimal income and commodity taxes in either direction. One possible (and arguably realistic) outcome is, nevertheless, that the desire to avoid the illegal production works to reduce both the alcohol tax and the marginal income tax rate. |
| Keywords: | taxation; external effects; alcohol; border trade. |
| JEL: | D61 D62 H21 H23 |
| Date: | 2005–04–04 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:umnees:0654&r=int |
| By: | Alessia Amighini; Stefano Chiarlone |
| Abstract: | The move towards export-oriented development strategies by China has increased concerns about the ability of Italian manifactures to effectively face price competition from emerging economies. This paper explores the hypothesis that the superior quality of Italian goods could support Italian competitiveness, using Spain as a benchmark. The data confirm that, although Italian and Chinese specialisation patterns are very similar, there is no widespread overlapping at the product level, and when there is, Italian goods show a higher quality level. Nonetheless, during the last decade, trade overlap increased and quality gap narrowed, suggesting that China is putting increasing competitive pressures on Italian manufacturing. In order to maintain its qualitative advantage, there is urgent need in Italy for an increase in investment in product upgrading and innovation. |
| Date: | 2004–06 |
| URL: | http://d.repec.org/n?u=RePEc:liu:liucec:150&r=int |
| By: | Hadi Soesastro (Department of Economics, Centre for Strategic and International Studies) |
| Abstract: | This paper discusses the need to beyond the old ‘ASEAN way’ and suggests the importance of further institutional deepening of economic cooperation in ASEAN, especially in the aftermath of the recent financial crisis. Hence, it suggests the need to develop of a ‘Common Market minus’, in which ASEAN brings in areas or sectors that are excluded from liberalization under the umbrella of the integration project and let them be managed through a common policy approach by newly created “regional units.” Yet, such a development needs to be carefully crafted, based on clear principles. |
| Keywords: | ASEAN, regional economic cooperation, institution building, ASEAN Vision 2020 |
| Date: | 2003–08 |
| URL: | http://d.repec.org/n?u=RePEc:eab:govern:71&r=int |
| By: | Hadi Soesastro (Department of Economics, Centre for Strategic and International Studies) |
| Abstract: | Recent development in global trade saw countries moving in multiple fronts in liberalising trade, utilising multilateral, regional and bilateral trade agreements to promote trade. This paper examines the issues surrounding this latest trend, noting the opportunities as well as dangers to global free trade associated with such an approach. In particular, it investigates implications of the growing numbers of regional trade agreements (RTAs) and free trade agreements (FTAs) within the APEC region, particularly in light of the Doha development agenda. |
| Keywords: | Asia-Pacific Economic Cooperation (APEC), World Trade Organization (WTO), Doha round, regional trade agreements (RTA), free trade agreements (FTA) |
| Date: | 2003–05 |
| URL: | http://d.repec.org/n?u=RePEc:eab:govern:73&r=int |
| By: | Tubagus Feridhanusetyawan (Department of Economics, Centre for Strategic and International Studies); Yose Rizal Damuri (Department of Economics, Centre for Strategic and International Studies) |
| Abstract: | This paper uses simulations based on a GTAP model to reproduce the economic crisis in Southeast Asia, and in particular in Indonesia. The model is a static-real sector model, so the focus of the simulation is on the declining investment and the declining prices of non-traded goods during the crisis. The simulation is conducted by creating an exogenous shock on risk premium in Indonesia, Thailand and Malaysia, which leads to smaller allocation of regional investment in these countries, lower stock of capital goods, and lower production. The second shock, which is the declining price of land and natural resource, opens the possibility of resource allocation between sectors in the economy. The results of the crisis simulation show that the declining overall GDP during the crisis is accompanied by declining productions of capital and labor-intensive commodities, and expansion of natural resource and land based sectors. Based on the simulation, the economic crisis is expected to lower production of forestry and forestry related manufacturing sectors, mainly because these sectors are more capital or labor intensive, rather than land or natural resource intensive. Consistent with the modeling exercise, the output of these sectors also declined in reality during the worst time of the crisis in 1997-99. The simulation results also show that the negative impact of the crisis on welfare, measured as the changes in equivalent variation, is serious. The second simulation in this study measures the impact of trade liberalization on the economy after the crisis. The results show that the potential benefit from trade liberalization is large, and larger than the welfare lost during the crisis. In other words, pursuing more progressive trade liberalization would speed up the economic recovery after the crisis by creating more opportunity to get the most benefit from the global economy. |
| Keywords: | Southeast Asia, Indonesia, Asian crisis, forestry sector, computable general equilibrium (CGE) |
| Date: | 2004–02 |
| URL: | http://d.repec.org/n?u=RePEc:eab:macroe:62&r=int |
| By: | Yoshiaki Sugimoto (Department of Economics, European University Institute) |
| Abstract: | This paper develops a growth theory that accounts for the evolution of trade policy, underlying internal class conflicts, and global income divergence over the last few centuries. By analyzing political responses to the distributional effects of international trade, this paper finds a prominent interaction between trade policy and the pattern of economic development, and suggests that the nature of the interaction depends on a country's resource abundance and distribution. As shown by the example of Western Europe, land-scarce countries will reach a developed stage through a non-monotonic evolution of trade policy. In contrast, land- abundant countries, especially those with concentrated landownership, tend to fail to take off because of landlords' opposition to industrialization. |
| Keywords: | Trade Policy, Growth, Class Conflict |
| JEL: | F10 F13 F43 O11 O40 |
| Date: | 2005–03–12 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpdc:0503003&r=int |
| By: | Julio J. Nogues (Universidad Di Tella) |
| Abstract: | Through financial channels, agricultural protectionism imposes costs on efficient producers that are higher than those associated with negative allocative effects and export losses usually estimated. The link between protectionism and finance has a direct relationship with the WTO Marrakech Agreement of establishing coherence between international trade and financial matters. Here, I call attention to the fact that for efficient agricultural exporters there is little if any coherence between the trading system and the international financial system that they face. I also present some numbers on the export losses from agricultural protectionism; describe the channels through which this protectionism increases financial costs; and analyze dynamic and poverty effects. |
| Keywords: | WTO, Coherence Agricultural Protectionism, Debt Problems |
| JEL: | F3 F4 |
| Date: | 2005–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpif:0502005&r=int |
| By: | Audra I.Mockaitis (Vilnius Univeristy); Erika Vaiginiene (Vilnius University); Vincent Giedraitis (University of California) |
| Abstract: | With the enlargement of the European Union, many Central and Eastern European (CEE) manufacturing companies have greater opportunity for internationalizing their activities. Although it is generally held that SMEs have the flexibility and ability to adapt to their environment more quickly than large enterprises, SMEs must be able to use these advantages in internationalizing. This study considers the internationalization efforts of a sample of Lithuanian manufacturing SMEs. Specifically, it is sought to reveal whether any patterns in the foreign market entry decisions of these firms may be found, through an examination of the degree of internationalization and its dependence on company age, size, risk aversion, commitment toward internationalization and knowledge acquisition. It is revealed that as yet, Lithuanian SMEs are in a state of uncertainty, and rely on manufacturing contracts in their home market. A pattern of “no pattern” may best describe their process of internationalization. |
| Keywords: | internationalization, SMEs, manufacturing sector, Lithuania |
| JEL: | L14 L21 L6 |
| Date: | 2005–02–03 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpio:0502001&r=int |
| By: | Lucia Quesada (University of Wisconsin Madison); Omar Chisari (Universidad Argentina de la Empresa) |
| Abstract: | We investigate the interactions between optimal regulation and external credit constraints. When part of a regulated ¯rm is owned by foreign investors, a credit-constrained country who wants to send pro¯ts abroad has to generate enough surplus in the trade account in order to compensate capital out°ows. We show that the credit constraint translates into a constraint of maximum profits for the regulated firm. Overall e±ciency in the regulated sector is reduced to maintain incentive compatibility. A flexible exchange rate helps relaxing the credit constraint. E±ciency is higher than with a fixed exchange rate, but still lower than without credit constraints. |
| Keywords: | Optimal regulation, Credit constraints, International trade |
| JEL: | D82 F32 L51 |
| Date: | 2005–04–06 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpio:0504004&r=int |
| By: | Gairuzazmi Ghani (USC) |
| Abstract: | Estimates of export and import demand functions for ninety countries using Stock and Watson (1993) Dynamic OLS are presented. These estimates are then used to examine the relationship between levels of economic development and the dynamic Harrod foreign trade multiplier. We show that there is an inverted U-shape relation, as predicted by Thirlwall (1997), contrary to Bairam (1993, 1997). The absence of an inverse relation between levels of economic development and the dynamic Harrod foreign trade multiplier means that Thirlwall's law implies divergence. |
| Keywords: | Harrod foreign trade multiplier, Thirlwall Law, Trade elaticities |
| JEL: | F1 F2 |
| Date: | 2005–01–25 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0501008&r=int |
| By: | Alpay Filiztekin (Sabanci University); Benan Z. Orbay (Istanbul Technical University) |
| Abstract: | We investigate the effects of exchange rate movements on investment decisions of firms in an oligopolistic market. In a two-country-world model, we focus on the capacity investment decisions of small (small initial capacity and high marginal cost) and large (large initial capacity and low marginal cost) domestic firms. Both type of firms use foreign inputs in production and sell their output in the foreign market, thus they are prone to changes in exchange rate from both cost and demand side. Results show that devaluations alter the composition of production and the relative share of small and inefficient firms at the expense of large and efficient firms in the economy. The investment response to exchange rates is more pronounced in more competitive markets. |
| Keywords: | Capacity investment, exchange rates, market structure. |
| JEL: | F1 F2 |
| Date: | 2005–01–28 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0501009&r=int |
| By: | Jong-Wha Lee (Korea University); Innwon Park (Korea University); Kwanho Shin (Korea University) |
| Abstract: | This paper investigates why regional trade arrangements (RTAs) are proliferating extensively and how the effects of multiple RTAs, by interacting with each other, evolve over time. Our empirical analysis, based on an extended gravity model utilizing a large panel data set of 175 countries from 1948 to 1999, shows that RTAs on average increase global trade by raising intra-bloc trade without damaging extra-bloc trade. The net trade effects, however, heavily depend on the types of RTA strategic evolution over time, which we group as ¡°expansionary¡± RTAs, ¡°duplicate¡± RTAs or ¡°overlapping¡± RTAs. We find that countries excluded from an RTA can benefit more from duplicating a separate RTA than from joining an existing RTA. This result explains why the number of bilateral trade blocs, rather than the membership size of existing RTAs, is currently exploding. We also find that the net trade creation effects of RTAs are substantially lower for countries participating in overlapping RTAs. This result suggests that it is less likely that the currently proliferating RTAs will completely merge and lead the world economy to global free trade. Our empirical results are robust to controlling for the characteristics of countries that may influence the impact of RTAs. |
| Keywords: | RTA, Global Trade, Regional Trade, Trade Creation, Trade Diversion |
| JEL: | F1 F2 |
| Date: | 2005–01–28 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0501010&r=int |
| By: | Boris Majcen (Institute for Economic Research Ljubljana); Miroslav Verbic (Institute for Economic Research Ljubljana); Sasa Knezevic (Institute for Economic Research Ljubljana) |
| Abstract: | The new version of the CGE model of the Slovenian economy, based on the 1998 SAM, was used for simulations of the consequences of further foreign trade liberalization after 1998 as the outcome of the finished processes of implementation of Free Trade Agreements and the European Agreement, adaptation of the Customs Tariff to the EU Common External Tariff for the manufacturing products, adoption of the EU Common External Tariff after the accession of Slovenia to the EU as well as the estimated transfers between both budgets. Results obtained show a positive net outcome of the Slovenian accession to the EU in the long run. On the other hand, rational behaviour of the government will certainly moderate possible short run negative effects and improve favourable long run effects. |
| Keywords: | Computable General Equilibrium Model, EU-Accession, Financial Flows, Trade Liberalization, Transition Country, Regionalism |
| JEL: | D58 F15 F43 E2 |
| Date: | 2005–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0501011&r=int |
| By: | Julio J. Nogues (Universidad Di Tella) |
| Keywords: | Mercosur, Agricultural Protectionism, Doha Round, Regional Negotiations |
| JEL: | F1 F2 |
| Date: | 2005–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502002&r=int |
| By: | Taiji Harashima (University of Tsukuba & Cabinet Office of Japan) |
| Abstract: | The paper explores the impacts of heterogeneity in degree of relative risk aversion on the balance on current account in a two-country endogenous growth model. It concludes that, like the heterogeneity of demographic changes, the heterogeneity in degree of relative risk aversion generates persisting current account deficits. The deficit continues permanently, but its ratio to output stabilizes. With evidence that the degree of relative risk aversion in Japan is relatively higher than that in the U.S., there is a possibility that the persisting bilateral trade deficit of the U.S. with Japan is partially generated by this mechanism. |
| Keywords: | Current account; Trade deficits; Capital flows; Endogenous growth; Risk aversion |
| JEL: | F41 F21 F43 O40 E10 |
| Date: | 2005–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502001&r=int |
| By: | Julio J. Nogues |
| Abstract: | Latin America will support the FTAA if it sees this project as a way of creating the conditions for improved growth performance and declining poverty. In searching for these objectives with effectiveness, this paper calls attention to some of the conditions that are necessary in order for individual countries to internalize benefits from the FTAA. I focus attention on the negotiations between Latin America and the United States because according to existing knowledge on the determinants of growth and convergence, it is the outcome of this exchange of concessions that holds the promise of the most significant gains for Latin America. This paper argues that such a convergence is more likely to take place if: (1) the outcome of these negotiations is characterized by a reciprocal and a significant exchange of market access concessions and, (2) Latin American countries strengthen some of their fundamental economic policies and institutions. |
| Keywords: | FTAA, Reciprocity, Intellectual Property |
| JEL: | F1 F2 |
| Date: | 2005–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502003&r=int |
| By: | Julio J. Nogues (Universidad Di Tella) |
| Abstract: | Regional trade agreements are more likely to produce negative effects on nonmembers the larger and the more protected they are. Because MERCOSUR countries are efficient producers of the most protected products in the world –agricultural and agro-industrial products-, these countries suffer particularly from other countries regional agreements. Finally, these costs are likely to increase with the number of regional agreements in which they are not members. The arguments and estimates presented in this paper support these assertions. |
| Keywords: | Mercosur, Trade diversion, Agricultural protection |
| JEL: | F1 F2 |
| Date: | 2005–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502004&r=int |
| By: | Julio J. Nogues (Universidad Di Tella) |
| Abstract: | On December 10, 2001 the US Department of Commerce announced the imposition of steep antidumping duties against honey imports from Argentina and China ranging from 32.6% to 183.8%, and a countervailing duty against Argentina of 5.9%. A previous AD investigation was concluded in 1995 with a uspension “agreement” that curtailed US imports from China by around 30%. Millions of beekeepers around the world most of them poor, are making a living from honey production and for them, a free and competitive world market would strengthen their possibilities of raising their standards of living. Nevertheless, the sequential pattern of increasing and widening protectionism followed by the US, the world top importer, to include successful exporters under the effects of its contingent protection measures, sends a clear message that other countries should think twice before investing in expanding honey exports to the US. |
| Keywords: | Antidumping, Poverty, Doha Round |
| JEL: | F1 F2 |
| Date: | 2005–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502005&r=int |
| By: | Julio J. Nogues (Universidad Di Tella) |
| Abstract: | An FTAA that provides gains to all participants remains a major challenge for LA. Given the demanding pre-conditions required in these and other negotiations with industrial countries, I am unsure whether all LA countries will be able to confront this challenge successfully. It is of paramount importance that Governments can document clear net gains to their societies, because otherwise a few years down the road, regional relations may become soured by an under-performing FTAA. |
| Keywords: | Latin America, FTAA negotiations, Agricultural protectionism |
| JEL: | F1 F2 |
| Date: | 2005–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502006&r=int |
| By: | Julio J. Nogues (Universidad Di Tella) |
| Abstract: | The outcome of the Uruguay Round show that the concessions given by developing countries were more valuable than those they received from industrial countries. I suggest that this outcome is explained by the aggresive demands from industrial countries and the lack of resources (human and financial) at the disposal of developing countries. The paper discussess the costs of these unequal exchanges, and the structural factors that help to understand the processess leading to these outcomes. |
| Keywords: | Uruguay Round, Developing countries, Reciprocity, |
| JEL: | F1 F2 |
| Date: | 2005–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502008&r=int |
| By: | Julio J. Nogues (Universidad Di Tella) |
| Abstract: | After decades of being a marginal player in the GATT trade negotiations, Argentina decided to participate actively in the Uruguay Round. This chapter measures the imbalance between the concessions given and received and concludes that the value of the first are far more important than the second. I discusss the economic consequence of this imbalance, and the prospects that the outcome of the Doha Round can be more balanced outcome for Argentina. |
| Keywords: | Argentina, GATT, Uruguay Round, Reciprocity, Intellectual Property |
| JEL: | F1 F2 |
| Date: | 2005–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502009&r=int |
| By: | J. Michael Finger (Vernon Taylor Professor of Economics, Trinity University); Julio J. Nogués (Universidad Di Tella) |
| Abstract: | The Uruguay Round involved a grand North-South bargain: The North reduced import barriers, particularly in textiles and agriculture. The South adopted new domestic regulations in such areas as services and intellectual property—changes that would lead to increased purchases from the North. In mercantilist economics, apples for apples—imports for imports. In real economics, apples for oranges. Finger and Nogués argue that while the North’s reduction of import barriers benefits both the North and the South, the new domestic regulations adopted by countries of the South could prove costly to those countries. To begin with, the regulations will be expensive to implement. And while the cost side of their impact is secured by a legal obligation (in the case of intellectual property rights, for example, the cost is higher prices for patented goods), the benefits side is not so secured. |
| Keywords: | Uruguay Round, Services negotiations, Doha Round reciprocity |
| JEL: | F1 F2 |
| Date: | 2005–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502010&r=int |
| By: | Julio J. Nogues (Universidad Di Tella) |
| Abstract: | The results of the Uruguay Round, show that the concessions given by developing countries were generally more valuable than those they received from industrial countries. I suggest that this outcome is explained by aggressive demands from industrial countries, and by the lack of resources at the disposal of developing countries. These and other “structural factors”, weaken the negotiating capacity of developing countries and the outcome of their bargaining, is likely to be an “unequal exchange of concessions”. The paper discussess the costs of these exchanges, and the structural factors that help to understand the processes leading to these outcomes. |
| Keywords: | Uruguay Round, Multilateral Negotiations, Developing countries, Unbalanced reciprocity |
| JEL: | F1 F2 |
| Date: | 2005–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502011&r=int |
| By: | Branko Milanovic (Carnegie Endowment/World Bank); Lyn Squire (Global Development Network) |
| Abstract: | The objective of the paper is to answer an often-asked question : if tariff rates are reduced, what will happen to wage inequality ? We consider two types of wage inequality : between occupations (skills premium), and between industries. We use two large data bases of wage inequality that have become recently available and a large dataset of average tariff rates all covering the period between 1980 and 2000. We find that tariff reduction is associated with higher inter-occupational and inter-industry inequality in poorer countries (those below the world median income) and the reverse in richer countries. The results for inter-occupational inequality though must be treated with caution. |
| Keywords: | tariffs, trade, liberalization, wages, inequality |
| JEL: | F1 F13 D31 J31 |
| Date: | 2005–02–11 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502012&r=int |
| By: | Heinz Hauser (Swiss Institute for International Economics & Applied Economic Research, University of St. Gallen SIAW-HSG); Thomas A. Zimmermann (Swiss Institute for International Economics & Applied Economic Research, University of St. Gallen SIAW-HSG) |
| Abstract: | The May 2003 deadline for the completion of the negotiations on improvements and clarifications of the Dispute Settlement Understanding (DSU) under the Doha Mandate has not been met. However, Members agreed in July 2003 to extend the deadline for the review until the end of May 2004. This article briefly summarises the past six years of negotiations on the DSU review, the most contentious issues and the systemic difficulties of the negotiations. We conclude with prospects for the forthcoming negotiations until 2004. |
| Keywords: | WTO Dispute Settlement Understanding DSU Review |
| JEL: | F1 F2 |
| Date: | 2005–02–27 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502014&r=int |
| By: | Thomas A. Zimmermann (Swiss Institute for International Economics & Applied Economic Research, University of St. Gallen SIAW-HSG) |
| Abstract: | Theoretical analyses of the WTO dispute settlement mechanism suggest that the system contains only weak incentives for the implementation of rulings. Against this background, it is puzzling that the specific WTO procedure which deals with allegedly insufficient implementation is used only in about one third of the cases where the need for implementation has arisen. Yet, a closer look at the where implementation has allegedly occurred can partly resolve this puzzle: The defendant government implemented the rulings by modifying or repealing the contemplated measures. At the same time, however, it resorted to alternative measures in order to keep the market closed. Some market opening occurred only after the conclusion of the multilateral procedure within bilateral negotiations and in areas which have not been subject to the multilateral dispute. This leads to the hypothesis that the role of the multilateral dispute settlement system could be less important than is generally accepted today. Note: The downloadable document is in German. |
| Keywords: | Protectionism, WTO Dispute Settlement, Implementation |
| JEL: | F1 F2 |
| Date: | 2005–02–27 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0502015&r=int |
| By: | Nelson H. Barbosa-Filho (Institute of Economics, Federal University of Rio de Janeiro) |
| Abstract: | This paper analyzes the trends and fluctuations of the price and real indexes of Brazilian and Argentine exports and imports in 1980-2002. The analysis uses quarterly data and obtains the trend and fluctuations by applying either the Hodrick-Prescott or the band-pass filter (with periodicity between 1.5 and 8 years) to the original series. The main statistical findings are that: (i) even though the fluctuations of the export and import prices of the two countries are highly correlated, their terms of trade are not because the export price of one country is also highly correlated with the import price of the other country; (ii) in both countries the fluctuations of real imports basically follow the fluctuations of real GDP; and (iii) fluctuations of Brazilian GDP and real imports are highly correlated and seem to lead fluctuations of Argentine exports. To obtain these results the paper analyzes the lead, lag and contemporaneous correlation between the series in question and applies the Granger causality test to investigate whether or not one variable helps to explain the other statistically. The statistical results for the fluctuations are robust for both filters. The trends are also basically the same independently of the filter used and, overall, they seem to converge in the late 1990s. The main policy implication is that exchange-rate coordination may be useful to compensate or smooth the adjustment of the two countries to terms-of-trade shocks, provided that the managed float is flexible enough to allow the bilateral real exchange rate to change according to which country is most affected by the shock. On the real side, synchronization of real GDP would lead to synchronization of real imports, whereas exchange-rate coordination may eliminate the swings of the bilateral real exchange rate between Brazil and Argentina, which is one of the sources of their desynchronized export fluctuations. |
| Keywords: | Brazil, Argentina, Trade |
| JEL: | F1 F2 |
| Date: | 2005–03–04 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0503001&r=int |
| By: | Nelson H. Barbosa-Filho (Institute of Economics, Federal University of Rio de Janeiro) |
| Abstract: | This paper presents the correlation between the annual fluctuations of the terms of trade of Brazil, Argentina, Uruguay and Paraguay. The period under analysis is 1980-2001 and the main findings are that the four countries have a high to moderate synchronization of their export prices, a moderate to low synchronization of their import prices, and a low synchronization of their terms of trade. The small positive correlation between the growth rates of the terms of trade of Brazil and Argentina (0.24) support exchange rate coordination between the two countries, provided that their bilateral real exchange rate is allowed to fluctuate temporarily to accommodate possible differences between the intensity of shocks across them. For instance, given an adverse shock to Brazil, both the Brazilian and Argentine real exchange rates against the rest of the world (domestic good per unit of foreign good) should increase to avoid a reduction, or smooth the variation, of their trade balances, but the Argentine currency should appreciate against the Brazilian currency in real terms because Argentina tends to be less affected by the shock. The observed correlations indicate that, through a joint and flexible managed float of their currencies, Argentina and Brazil may be able to share the benefits and costs of terms-of-trade shocks without imposing major macroeconomic disruptions on each other. In such an arrangement and also based on the observed correlations, Uruguay may either follow Argentina, when the terms-of-trade shock is more intense to Brazil, or do nothing, when the shock is more intense to Argentina. In contrast, Paraguay should follow Brazil, when the terms- of-trade shock is more intense to Argentina, or do nothing, when the shock is more intense to Brazil. Because of the low correlation between the terms-of-trade fluctuations of Brazil and Argentina, the best form of exchange-rate coordination for the near future seems to be a Mercosur version of the European Monetary System of 1979-98, that is, a wide interval of fluctuation for the regional currencies around a common and competitive real exchange rate against the rest of the world. |
| Keywords: | Mercosur, Trade, Exchange-Rate Coordination |
| JEL: | F1 F2 |
| Date: | 2005–03–04 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0503002&r=int |
| By: | kishore gawande (texas a&m u.); pravin krishna (Johns hopkins u.) |
| Abstract: | In order to explain the prevalence and persistence of trade protection, a large body of work that departs from the notion of welfare maximizing governments and emphasizes instead political-economic determinants of policy has recently emerged. This survey paper summarizes and evaluates analytically the empirical component of this literature. We discuss a broad set of empirical findings which provide a convincing confirmation of the presence and significance of political economy influences. We also discuss some puzzles and controversies that have emerged in recent work. |
| JEL: | D72 D78 F12 F13 F14 |
| Date: | 2005–03–09 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0503003&r=int |
| By: | Danica Popovic (Faculty of Economics & CLDS) |
| Abstract: | Both before and after the UN trade embargo (1992-1995), the foreign trade policy of FR Yugoslavia has been highly autarchic. Until the disingegraditon of SFRY this resulted in a significant underperformance of the foreign trade sector, while later this turned out to (almost) a complete halt in regular foreign trading. The key for boosting foreign trade lies in implementing institutional reforms and liberalization of foreign trade, even prior to the start of a credible mass privatization. This would be the only way to avoid creation of unproductive private monopolies and might present a way out of permanent recession of the Serbian economy. |
| JEL: | F1 F2 |
| Date: | 2005–03–14 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0503006&r=int |
| By: | Danica Popovic (Faculty of Economics & CLDS) |
| Abstract: | This study is divided in ten sections. The first three sections are devoted to macroeconomic performance of the economy in the 1990s, followed by the analysis of contemporary foreign trade performance and institutions. The overall and dramatic decay starting from 1990 is registered in all topics abovementioned. The next three sections are devoted to foreign trade policies toward imports, exports and domestic competition. A significant improvement in foreign trade policies is registered, but a need for further liberalization is also stressed upon, particularly regarding the abolition of statistical fee, and further reduction and simplification of tariffs. The implementation of safeguards and antidumping policies has not started as yet, mostly for the lack of professional skills in the area. The highly monopolized structures of Yugoslav economy will presumably stay at least while the privatization procedure is not completed in a substantial degree. As far as regulations of entry and domestic competition are concerned, no serious formal impediments can be traced. Since corruption and cronyism are still widespread (not only in foreign trading but in judicary system etc) informal impediments to competing on domestic market are still present. The last three sections are focused on the political economy of trade policy, problems of market access on the EU and other markets. |
| JEL: | F1 F2 |
| Date: | 2005–03–14 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0503007&r=int |
| By: | Carl Davidson (Michigan State University); Steven Matusz (Michigan State University) |
| Abstract: | Liberalization harms some groups while generating aggregate benefits. We consider various labor market policies that might be used to compensate those who lose from freer trade. Our goal is to find the policy that compensates each group of losers at the lowest cost to the economy. We argue that wage subsidies should be used to compensate those who bear the adjustment costs triggered by liberalization while employment subsidies should be used to compensate those who remain trapped in the previously protected sector. Our analysis indicates that the cost of compensation is low, provided that the right policy is used. |
| Keywords: | International Trade, Liberalization, Compensation, Labor Market Policies |
| JEL: | F1 F2 |
| Date: | 2005–03–15 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0503008&r=int |
| By: | Carl Davidson (Michigan State University); Steven Matusz (Michigan State University) |
| Abstract: | Is the pattern of trade correlated with cross-sector differences in job turnover? Theoretically, external shocks feed through to changes in domestic employment and cross-sector differences in turnover give rise to compensating wage differentials, which feed through to output prices. Using two different data sets on turnover, we find strong evidence that normalized US net exports by sector are negatively correlated with job destruction and worker separation rates. Weaker evidence suggests a positive correlation with between normalized net exports and job acquisition. Using sector-specific job destruction data for both Canada and the US, we find confirmation of the theoretical prediction that normalized net exports to Canada are negatively related to the ratio of the US job destruction rate to the Canadian job destruction rate. |
| Keywords: | Job Creation, Job Destruction, Trade, Labor |
| JEL: | F16 |
| Date: | 2005–03–15 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0503009&r=int |
| By: | Christopher Magee (Bucknell University); Carl Davidson (Michigan State University); Steven Matusz (Michigan State University) |
| Abstract: | This paper examines the hypothesis that turnover affects trade preferences. High turnover industries are similar to the Stolper- Samuelson assumption of perfect factor mobility, so factor of production drives trade preferences. Among low turnover industries, as in the specific factors model, net export position determines trade preferences. We show that PAC contribution patterns are consistent with this hypothesis. In high turnover industries, capital groups give significantly larger shares of their campaign contributions to free trade supporters than labor groups do. Among low turnover industries, on the other hand, exporting and import-competing groups differ significantly in their financial support for free traders. |
| Keywords: | Trade Preferences, Trade and Wages, Campaign Contributions, Stolper-Samuelson, Specific Factors |
| JEL: | F10 F11 F16 |
| Date: | 2005–03–15 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0503010&r=int |
| By: | José Caetano (University of Évora); Aurora Galego (University of Évora) |
| Abstract: | The Eastern enlargement represents an opportunity for trade expansion for all the countries involved. In fact, trade between the EU and the Central Eastern European Countries (CEEC) has grown considerably in the nineties, coinciding with the transition period and the preparation of the CEEC to full-membership. In this paper we analyse the characteristics and evolution of the EU- CEEC trade in the last decade and study the potential bilateral trade flows between the EU and the CEEC. In particular, besides analysing trade relations between CEEC and the EU, we will study trade developments among the CEEC. Moreover, we will take into consideration the sectoral dimension in the analysis. The analysis is based on the gravity model approach using panel data from 1993 to 2001. It is possible to conclude that there is still scope for further expansion of the trade flows between some CEEC and some of the EU countries. Furthermore, there is scope for growth on trade flows among the CEEC, due to the fact that EU membership will promote complete trade liberalisation among these countries. |
| Keywords: | Trade, EU enlargement, Gravity Models |
| JEL: | F1 F2 |
| Date: | 2005–04–07 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0504002&r=int |
| By: | Thomas A. Zimmermann (Swiss Institute for International Economics & Applied Economic Research SIAW-HSG) |
| Abstract: | ENGLISH ABSTRACT: On 1 January 1995, the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) entered into force. During its first ten years, the DSU has since been applied to 324 complaints – more cases than dispute settlement under the GATT 1947 had dealt with in nearly five decades. The system is perceived, both by practitioners and in academic literature, to work generally well. However, it has also revealed some flaws. Negotiations to review and reform the DSU have been taking place since 1997 (“DSU review”), however, without yielding any result so far. In the meantime, WTO Members and adjudicating bodies managed to develop the system further through evolving practice. While this approach may remedy some practical shortcomings of the DSU text, the more profound imbalance between relatively efficient judicial decisionmaking in the WTO (as incorporated in the DSU) and nearly blocked political decisionmaking evolves into a serious challenge to the sustainability of the system. This article provides an overview of the first ten years of DSU practice, the on- going DSU review negotiations, and the challenges to the dispute settlement system. GERMAN ABSTRACT: Am 1. Januar 1995 trat das Übereinkommen über Regeln und Verfahren für die Streitschlichtung (Dispute Settlement Understanding; DSU) als Teil des WTO-Abkommens in Kraft. In den ersten zehn Jahren seines Bestehens fand das DSU auf 324 Klagebegehren Anwendung – mehr Fälle, als unter den Streitschlichtungsregeln des GATT 1947 in dessen nahezu fünfzigjähriger Geschichte behandelt wurden. Die Funktionsweise des Systems wird sowohl in der handelspolitischen Praxis als auch in der wissenschaftlichen Literatur als gut eingestuft. Gleichwohl hat der Mechanismus in seiner Anwendung auch einige Schwächen offenbart. Diese sollen auf dem Verhandlungswege („DSU Review“) behoben werden, doch blieben die seit Ende 1997 laufenden Gespräche bislang erfolglos. Zugleich ist es den Mitgliedstaaten und den Spruchorganen aber stellenweise gelungen, das System im Rahmen der praktischen Anwendung fortzuentwickeln. Während auf diesem Weg einige praktische Probleme des Verfahrenstextes behoben werden konnten, dürfte das beträchtliche Ungleichgewicht in der WTO zwischen einem vergleichsweise effizienten juristischen Entscheidungsmechanismus (in Form des DSU) und den häufig blockierten politischen Entscheidungsmechanismen fortbestehen. Dieses Ungleichgewicht bedroht die Systemnachhaltigkeit. Der vorliegende Artikel gibt einen Überblick über die ersten zehn Jahre DSU-Praxis, die laufenden DSU-Review-Verhandlungen sowie einen Ausblick auf zukünftige Herausforderungen. |
| Keywords: | WTO, Dispute Settlement, DSU Review Negotiations |
| JEL: | F02 F13 K33 K41 |
| Date: | 2005–04–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0504003&r=int |
| By: | William Barnett (University of Kansas); Mehmet Dalkir (University of Kansas) |
| Abstract: | This paper investigates the transmission mechanisms of noise and volatility between economies through trade links, and the effects of synchronization on business cycles. We investigate the transmission of outside noise and the fluctuations that the noise generates. We identify conditions under which international economic links reduce the economic output noise emanating from noise within the individual economies. Under certain conditions, devaluation of a country's currency causes reduction in the business cycle noise and volatility as seen by that country's exporters, while increased valuation of a country's currency produces higher noise and volatility, as seen by the country's importers. |
| Keywords: | business cycles, synchronization, international trade, stochastic systems |
| JEL: | D5 D9 E |
| Date: | 2005–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpit:0504004&r=int |
| By: | Branko Milanovic (Carnegie Endowment for International Peace); Lyn Squire (Global Development Network) |
| Abstract: | The objective of the paper is to answer an often-asked question : if tariff rates are reduced, what will happen to wage inequality ? We consider two types of wage inequality : between occupations (skills premium), and between industries. We use two large data bases of wage inequality that have become recently available and a large dataset of average tariff rates all covering the period between 1980 and 2000. We find that tariff reduction is associated with higher inter-occupational and inter-industry inequality in poorer countries (those below the world median income) and the reverse in richer countries. The results for inter-occupational inequality though must be treated with caution. |
| Keywords: | tariffs, trade, liberalization, wages, inequality |
| JEL: | F1 F13 D31 J31 |
| Date: | 2005–01–27 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpla:0501012&r=int |
| By: | Tapen Sinha (ITAM, Mexico); Bradly J Condon (ITAM, Mexico) |
| Abstract: | As of January 1, 2005, all developing country members of the WTO are required to implement the WTO Agreement on Trade Related Intellectual Property Rights (TRIPS). We analyze the issue of access to patented medicine to treat global and neglected diseases in developing countries in the context of WTO law. We present legal and economic arguments that support balancing the rights of producers and users on a market-by- market basis and argue against taking a uniform approach globally. We conclude that global patent rights are not necessary to provide research incentives to pharmaceutical firms to invent treatments for global and neglected diseases. We develop an analytical framework for assessing special and differential treatment of developing countries in WTO law and apply this framework to TRIPS. We then propose a formula for assessing the correct balance between the rights of producers and users on a market-by-market basis. |
| Keywords: | WTO, TRIPS, AIDS, Chapter 6, HIV, Index Construction |
| JEL: | K |
| Date: | 2005–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwple:0502003&r=int |
| By: | Richard Pomfret (University of Adelaide, School of Economics) |
| Abstract: | This paper analyses the choices between regionalism and multilateralism, and the impact of WTO membership on the five Central Asian countries. The two main sections analyse (1) why the large number of regional trade agreements which the Central Asian countries have signed have had little economic impact, and (2) the consequences for the Central Asian countries of Chinese and Russian WTO membership and the consequences of the current Central Asian applicants’ (Kazakhstan, Tajikistan and Uzbekistan) own WTO accession. During the1990s, many regional trade agreements were signed - arrangements both among the Central Asian countries, and between Central Asian countries and their neighbours (Russia to the north, China to the east, and Iran and Turkey to the south) – but not implemented and, although the Kyrgyz Republic became a WTO member in 1998, the Central Asian countries vacillated between pursuing regional and multilateral trade policy avenues. The Central Asian countries’ relationship to the WTO became a more pressing issue after China’s long-running WTO accession negotiations were successfully concluded in December 200 and as Russian negotiations are move forward. At the same time the push towards regionalism is also affected by external events such as the European Union’s deeper integration, symbolized by the appearance of euro banknotes in 2002, and the eastward expansion of the EU in 2004. |
| Keywords: | regionalism; WTO; Central Asia |
| JEL: | P33 F13 F14 |
| Date: | 2005–02–03 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpot:0502003&r=int |
| By: | Richard Pomfret (University of Adelaide, School of Economics) |
| Abstract: | Regional integration for at least the last sixty years has focused on trade integration. Balassa’s canonical taxonomy of regional trading arrangements is often interpreted as a sequence from free trade area through customs union and common market to economic union. In the 1980s the concept of deep integration went beyond trade with its focus on policy harmonization, which came to include monetary integration, but it presupposed trade integration as the first step in the regional integration sequence. In Asia there has been very little trade integration through regional agreements - ASEAN is the most ambitious project, but even there actual achievements in trade integration have been limited. When discussion of monetary integration began in East Asia after 1997, it was in the absence of trade integration. The conventional view would see this as an obstacle to greater regional integration, but some proponents of Asian regionalism saw monetary integration as a step towards promoting trade integration, reversing the orthodox sequence. The two theoretical literatures (customs union theory and optimal currency area theory) were distinct and there remains a disconnect between the trade and monetary integration literature. This paper re- evaluates the global cross-country evidence on the relationship between trade integration and monetary union. It then applies the results to the prospects for monetary union before trade integration in East Asia, and to the consequences of monetary union for trade integration. |
| Keywords: | currency union; customs union |
| JEL: | F02 F13 F33 |
| Date: | 2005–02–03 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpot:0502004&r=int |
| By: | Andrea Moro (University of Minnesota); Matthew F. Mitchell (University of Iowa) |
| Abstract: | Why are trade barriers often used to protect home producers, even at the cost of introducing deadweight losses from higher commodity prices? We add an informational friction to the standard textbook argument in favor of free trade, and show that trade restrictions may be a more effcient policy than a lump sum transfer to the displaced producers. Trade barriers, while generating deadweight losses, have the benefit that they do not generate a need for compensation. When the policy maker does not know the amount that should be transferred, the risk of over- compensating may make trade barrier more efficient. |
| Keywords: | Trade barriers, Distortionary policies |
| JEL: | D6 D7 H |
| Date: | 2005–03–10 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwppe:0503004&r=int |
| By: | VladimÃr BenáÄek; Ladislav Prokop; Jan Ã. VÃÅ¡ek |
| Abstract: | Using panel data for 29 industries, we test alternative specifications of Czech export and import functions. The balance of trade is primarily influenced by the real exchange rate, aggregate demand and tariff changes. Reduced growth of the Czech economy after 1996 was an important factor that has kept the balance of trade at a sustainable level in the medium-term, contributing even to the appreciation of the real exchange rate. The secondary fundamental factors, relevant for structural adjustments, a sustainable trade balance and an equilibrium exchange rate, rest, however, on supply-side characteristics such as changes in endowments of physical and human capital, inflows of FDI and growing competitiveness of domestic production. We can argue that appreciation of the real exchange rate is a handicap to Czech exports, especially to exports to non-EU countries. Nevertheless, in the EU case, the appreciation of koruna was countervailed by tariff concessions, improved quality, switchover to commodities with higher contents of value added, gains associated with FDI and growing foreign demand absorption. At the same time, appreciation of the real exchange rate has significantly opened the Czech market to imports but the unconstrained import penetration remained blocked by the growing competitiveness of Czech products in costs, prices and quality. |
| Keywords: | export and import specialisation; international trade; panel data estimation; production factor intensities; sectoral trade balance. |
| JEL: | C23 F14 F32 |
| Date: | 2003–06 |
| URL: | http://d.repec.org/n?u=RePEc:cnb:wpaper:2003/03&r=int |
| By: | Tomáš Holub; Martin Čihák |
| Abstract: | The paper provides a theoretical reference point for discussions on adjustments in price levels and relative prices. The authors present a “nested†model integrating the Balassa–Samuelson model of the real equilibrium exchange rate with a model of accumulation of capital and with the demand side of the economy. Consequently, they show how the model can be generalised to a case of numerous commodities with different degrees of tradability. The predictions of the model are generally consistent with empirical findings for Central and Eastern European countries. The authors show how the theoretical model can be used for internally consistent simulations of the future convergence process in a transition economy. |
| Keywords: | Balassa–Samuelson model, inflation, relative prices. |
| JEL: | E31 E52 E58 F15 P22 |
| Date: | 2003–12 |
| URL: | http://d.repec.org/n?u=RePEc:cnb:wpaper:2003/08&r=int |
| By: | Rana Hasan (Asian Development Bank); Devashish Mitra (Department of Economics, Maxwell School of Citizenship and Public Affairs, Syracuse University); K.V. Ramaswamy (IGIDR) |
| Abstract: | This paper finds a positive impact of trade liberalization on labor-demand elasticities in the Indian manufacturing sector using industry-level data disaggregated by states. These elasticities turn out to be negatively related to protection levels that vary across industries and over time. Furthermore, we find that these elasticities are higher for Indian states with flexible labor regulations where they are also impacted more by trade reforms. Finally, we find that after the reforms, volatility in productivity and output gets translated into larger wage and employment volatility, theoretically a possible consequence of larger labor-demand elasticities. |
| Date: | 2003–06 |
| URL: | http://d.repec.org/n?u=RePEc:ewc:wpaper:wp59&r=int |
| By: | Rana Hasan (Asian Development Bank); Lan Chen (Graduate student, University of Hawaii-Manoa) |
| Abstract: | We combine labor force survey data with trade and production data to examine the impact of trade on wages and employment in the Philippines' manufacturing section. Our main finding are as follows. First, in contrast to findings typically reported for Latin American countries, our data indicate that wage inequality in the Philippines' manufacturing sector has declined over the period in which trade liberalization has been undertaken. This is despite the fact that reductions in tariff rates were largest in less skill intensive manufacturing industries. There has also been an absence of any secular rise in returns to higher education. Second, tariff reductions have been associated with declines in industry wage premiums in capital-intensive industries. Moreover, these declines appear to have been largest for skilled workers. Finally, tariff reductions have had an insignificant effect on both employment as well as the average hours of work of full-time employees across industries. These findings are consistent with a scenario where workers in capital-intensive industries, especially the more skilled ones, earned rents prior to trade liberalization; liberalization may have worked to erode these. |
| Date: | 2003–09 |
| URL: | http://d.repec.org/n?u=RePEc:ewc:wpaper:wp61&r=int |
| By: | S.M. Thangavelu (Department of Economics, National University of Singapore); Toh Mun Heng (Department of Business Policy, National University of Singapore) |
| Abstract: | The World Trade Organisation’s 2004 Trade Policy Review of Singapore (WTO-TPR Singapore 2004) depicts the small and outward-oriented economy as one of the most open country to international trade and investment. The review highlights the benefits of the outward-oriented strategy that has enabled the Singapore economy to weather recent external shocks such as the Asian financial crisis to the SARS and to the recent unfavourable conditions in the Middle East. In particular, the report commended Singapore’s efforts on its liberalization of the services sector and its economic benefits to consumers and global trade. However, the WTO-TPR Singapore 2004 highlights several key areas of concerns: (a) the commitment to multilateral agreements with the rising number of bilateral free trade agreements signed by Singapore and (b) the lack of growth of total factor productivity, a key indicator for long-run efficiency of the economy. The paper addresses the above key concerns raised in the WTO’s TPR of Singapore in terms of its commitment to global trade in terms of WTO-plus bilateral FTAs, which intends to support multilateral trading system, and its overall industrial strategies to raise its competitiveness. |
| URL: | http://d.repec.org/n?u=RePEc:sca:scaewp:0505&r=int |