nep-int New Economics Papers
on International Trade
Issue of 2011‒06‒18
23 papers chosen by
Alessia A. Amighini
University Amedeo Avogadro

  1. CEECs Integration into Regional and Global Production Networks By Inmaculada Martínez-Zarzoso; Anca M. Voicu; Martina Vidovic
  2. The Export Promoting Effect of Emigration: Evidence from Denmark By Sanne Hiller
  3. International harmonization of product standards and firm heterogeneity in international trade By Reyes, Jose-Daniel
  4. Does Importing more Inputs Raise Exports? Firm Level Evidence from France By Maria Bas; Vanessa Strauss-Kahn
  5. Exports, imports and profitability: First evidence for manufacturing enterprises By Joachim Wagner
  6. Trade Policy Determinants and Trade Reform in a Developing Country By Baybars Karacaovali
  7. Establishment heterogeneity, exporter dynamics, and the effects of trade liberalization By George Alessandria; Horag Choi
  8. Trade in Intermediate Products and EU Manufacturing Supply Chains By Jyrki Ali-Yrkkö; Petri Rouvinen; Timo Seppälä; Pekka Ylä-Anttila; Robert Stehrer; Roman Stöllinger; Doris Hanzl-Weiss; Neil Foster
  9. Effect of International Standards Certification on Firm-Level Exports: An Application of the Control Function Approach By Tsunehiro Otsuki
  10. Pakistan's trade competitiveness & complementarities in South Asia By Mamoon, Dawood; Paracha, Sohail; Mughal, Hammad; Ayesha, Annam
  11. Need for Speed: Is Faster Trade in the EU Trade-Creating? By Cecília Hornok
  12. Trade and the Greenhouse Gas Emissions from International Freight Transport By Anca D. Cristea; David Hummels; Laura Puzzello; Misak G. Avetisyan
  13. China's High-tech Exports: Myth and Reality By Yuqing Xing
  14. The impact of trade preferences on exports of developing countries: the case of the AGOA and CBI preferences of the USA By Cooke, Edgar F A
  15. Individual attitudes towards trade: Stolper-Samuelson revisited By Jäkel, Ina C.; Smolka, Marcel
  16. Behind the Eastern-Western European convergence path: the role of geography and trade liberalization By Adolfo Cristobal-Campoamor; Osiris Jorge Parcero
  17. Implications of the Doha market access proposals for developing countries By Laborde, David; Martin, Will; van der Mensbrugghe, Dominique
  18. Trade, Wages, FDI and Productivity By Christian Schwarz; Kristian Giesen
  19. Skills, Exports, and the Wages of Seven Million Latin American Workers By Irene Brambilla; Rafael Dix Carneiro; Daniel Lederman; Guido Porto
  20. How Wages and Employment Adjust to Trade Liberalization: Quasi-Experimental Evidence from Austria By Marius Brülhart; Céline Carrère; Federico Trionfetti
  21. Trade facilitation for economic corridors in South Asia: the perspective of Pakistan By Vaqar , Ahmed; Ghulam , Samad
  22. Productivity gains and spillovers from offshoring By Klaus-Bernhard Michel; François Rycx
  23. Exports and Italy’s economic development: a long-run perspective (1863-2004) By Barbara Pistoresi; Alberto Rinaldi

  1. By: Inmaculada Martínez-Zarzoso; Anca M. Voicu; Martina Vidovic
    Abstract: This paper examines the involvement of the CEECs into regional and global production networks over the period 1999 to 2009. We employ a theoretically justified gravity model which incorporates the extensive margin of trade and accounts for firm heterogeneity. We first estimate the model for highly disaggregated exports (SITC 5-digits) in final goods, and then augment it by including the corresponding imported intermediate products from the OECD together with the usual control variables. Next, we estimate the model for each trade margin (extensive and intensive) separately to evaluate the effects of economic integration on exports and imports of each category of goods. Our results indicate that the CEECs have indeed become more integrated into regional production networks and this has had a positive impact in terms of increasing trade volumes and trade varieties between the two parts of the European continent.
    Keywords: exports; gravity equation; panel data; production networks; economic integration; trade flows.
    JEL: F10 F14 D31
    Date: 2011–05–23
  2. By: Sanne Hiller
    Abstract: The theoretical claim that ethnic networks encourage trade has found broad empirical support in the literature on migration, business networks and international trade. Ethnic networks matter for the exporting firm, as they exhibit the potential to lower fixed and variable cost of exporting. This paper provides a first attempt to identify the export-promoting effect of emigration on the firm level. Using detailed Danish firm-level data, we can parsimoniously control for export determinants other than emigration, unobserved heterogeneity at the firm level, as well as for self-selection of firms into exporting. Additionally accounting for taste similarity between Denmark and its trade partners, our findings suggest a positive effect of emigration on Danish manufacturing trade within Europe, thereby corroborating preceding studies on aggregate data. Nevertheless, as a novel insight, our analysis reveals that the only beneficiaries of emigration are small enterprises.
    Keywords: Emigration, Brain Drain, Small Businesses, International Trade, Firm-level analysis
    JEL: F22 F16
    Date: 2011–06–01
  3. By: Reyes, Jose-Daniel
    Abstract: As free trade areas have proliferated and statutory tariffs have been dramatically reduced in recent decades, non-tariff barriers (NTBs) to international trade have risen in importance. Destination-specific product standards are one of the major types of NTBs as they impose additional costs on exporters and increase the time required to bring a product to market. This paper examines the response of U.S. manufacturing firms to a reduction of this NTB by looking at the harmonization of European product standards to international norms in the electronics sector. Using a highly detailed dataset that links U.S. international trade transactions to U.S. firms and a new industry-level database of EU product standards, the author finds that harmonization increases U.S. exports to the EU and that this increase is due to more U.S. firms entering the EU market –the extensive margin of trade. New entrants to the EU region are drawn mainly from the most productive set of firms already exporting to developing markets before harmonization -the extensive margin of trade composition. These firms are characterized by being smaller and less productive than the firms that were already exporting to the EU before harmonization. Furthermore, harmonization decreases export sales at existing exporters -the intensive margin of trade. These findings are consistent with a model featuring the role of product standards heterogeneity across market destinations and productivity heterogeneity across firms. These results suggest that working toward a harmonization of product rules across markets could be a supportive policy to encourage small and medium size firms'ability to enter new export markets.
    Keywords: Markets and Market Access,E-Business,Information Security&Privacy,Economic Theory&Research,Labor Policies
    Date: 2011–06–01
  4. By: Maria Bas; Vanessa Strauss-Kahn
    Abstract: Why would an increase in imported inputs rise exports? We argue that importing more varieties of intermediate inputs increases firm’s productivity and thereby makes the firm able to overcome the export fixed costs. Whereas the literature evidences the positive effect of an increase in imported inputs on firms’ productivity and shows that only the most productive firms export, the link between imported intermediate inputs and export scope has not been made. This paper bridges the gap by studying the impact of imported inputs on the margins of exports. We use a firms’ level database of imports at the product (HS6) level provided by French Customs for the 1995-2005 period. Access to new varieties of inputs may increase productivity, and thereby exports, through better complementarity of inputs and transfer of technology. We test for these different mechanisms by distinguishing the origin of imports (developing vs. developed countries). We find a significant impact of higher diversification and increased number of imported inputs varieties on firm’s TFP and export scope. Both the complementarity and transfer of technology mechanisms seem to matter.
    Keywords: Firm heterogeneity; imported inputs; TFP; export scope; varieties; firm-level data
    JEL: F10 F12
    Date: 2011–06
  5. By: Joachim Wagner (Institute of Economics, Leuphana University of Lüneburg, Germany)
    Abstract: This paper documents for the first time the relationship between profitability and three types of international trade activities – exports, imports and two-way trade. It uses unique new representative data for manufacturing enterprises from Germany, one of the leading actors on the world market for goods, that merge information from surveys performed by the Statistical Offices and administrative data collected by the Tax Authorities. Descriptive statistics and regression analysis (with and without controlling for unobserved firm heterogeneity and the role of outliers) point to the absence of any statistically significant and economically large effects of trade activities on profits. This demonstrates that any productivity advantages of trading firms are eaten up by extra costs related to selling and buying on foreign markets.
    Keywords: exports, imports, profitability
    JEL: F14
    Date: 2011–06
  6. By: Baybars Karacaovali (Fordham University, Department of Economics)
    Abstract: In this paper, I start out with a standard political economy of trade policy model to measure the determinants of trade policy in a developing country. I carefully test the model empirically with Colombian data from 1983 to 1998 accounting for endogeneity and omitted variable bias concerns and then expand it in several directions.. I show that it is important to control for the impact of a drastic trade reform shock that affects all sectors and disentangle its effect from preferential trade agreements (PTAs). I find that protection is higher in sectors that are important exports for preferential partners which may be seen as a stumbling effect of PTAs for Colombia. I also relax the assumption of fixed political weights that measure the extra importance of producers' welfare relative to consumers in the government objective. I measure the impact of sectoral characteristics on tariffs indirectly through political weights as a novel alternative to nonstructurally estimating them as determinants of protection. Accordingly, I obtain more realistic estimates for the political weights further contributing to the literature.
    Keywords: Political economy of trade policy, trade liberalization, preferential trade agreements, empirical trade
    JEL: F13 F14 F15
    Date: 2011
  7. By: George Alessandria; Horag Choi
    Abstract: The authors study the effects of tariffs in a dynamic variation of the Melitz (2003) model, a monopolistically competitive model with heterogeneity in productivity across establishments and fixed costs of exporting. With fixed costs of starting to export that are on average 3.7 times as large as the costs incurred to continue as an exporter, the model can match both the size distribution of exporters and annual transition in and out of exporting among US manufacturing establishments. The authors find that the tariff equivalent of these fixed costs is nearly 30 percentage points. They use the calibrated model to estimate the effect of reducing tariffs on welfare, trade, and export participation. The authors find sizeable gains to moving to free trade equivalent to 1.03 percent of steady state consumption. Considering the transition dynamics following the cut in tariffs, they find that the model predicts economic activity overshoots its steady state, with the peak in output coming 10 years after the trade reform. Because of this overshooting, steady state changes in consumption understate the welfare gain to trade reform. The authors also find simpler trade models that abstract from these export dynamics provide a poor approximation of the aggregate responses from our more general model.
    Keywords: International trade ; Tariff
    Date: 2011
  8. By: Jyrki Ali-Yrkkö; Petri Rouvinen; Timo Seppälä; Pekka Ylä-Anttila; Robert Stehrer (The Vienna Institute for International Economic Studies, wiiw); Roman Stöllinger (The Vienna Institute for International Economic Studies, wiiw); Doris Hanzl-Weiss (The Vienna Institute for International Economic Studies, wiiw); Neil Foster (The Vienna Institute for International Economic Studies, wiiw)
    Abstract: Where is your mobile coming from? This simple question is not easy to answer as the mobile has been assembled using components from different countries (including the domestic) and by using services from the domestic and foreign economies. This multi-country nature of products is not only a feature of more complex high-tech products (such as mobile phones, cars, etc.) but in almost all cases a product is not made up entirely of components or inputs from the country where it is finally assembled or sold. At least some of the components and services (e.g. transport services) necessary to bring the final product to the customer are sourced abroad. This is the case for direct inputs in the way that firms purchase intermediate inputs for production domestically and abroad but even more so in an indirect way: A component from a particular country may already embody other inputs from other countries which are thus used indirectly when using this component for production purposes. The other way round, companies may ship high-tech components to other countries where assembly of the final product takes place. Based on this background of the importance of the multi-country nature of products, the report provides a detailed analysis of the structure of the international production process and trade in intermediates with respect to EU countries at various levels. Using information gathered from detailed trade statistics, the report analyses the relative importance of trade in intermediate products in overall trade, the respective changes over time and the important differences among the EU-27 countries. Here the importance of considering both exports and imports of trade in intermediates is emphasized. The study investigates the geographic structure of sourcing and provision of intermediates, pointing out important regional shifts, specialization patterns, the significance of two-way trade in intermediates, extensive and intensive margins by use categories and other characteristics such as quality aspects. The report then continues providing information on the using side of imported intermediates and its role in inter-industry linkages. This is further exemplified at a very detailed level – at the level of a single product, the Nokia N95 – analysing the complexity of international production processes for a high-tech product. Finally, the study provides insights into the effects of the crisis on trade in intermediates – whether being a cause or consequence of the trade collapse – and potential implications for future developments.
    Keywords: intermediates trade, supply chain, trade collapse
    JEL: F14
    Date: 2011–02
  9. By: Tsunehiro Otsuki (Osaka School of International Public Policy, Osaka University)
    Abstract: Growing number of firms in developing countries have earned certifications such as International Standards Organization (ISO) as it enhances reputation of their company or brand and attract buyers particularly in export market. This study evaluates the effect of international standards certification on firm's export performance in Europe and Central Asia by applying the control function approach with endogenous treatment effect to firm-level data. Certification is found to increase export share in firm's sales by 44.9% on average. The results suggest that ignoring the effect of self-selection of certification leads to a substantial bias in the estimated treatment effect.
    Keywords: ontrol Function, international standards, international trade, self-selection
    JEL: C34 F10 L15
    Date: 2011–06
  10. By: Mamoon, Dawood; Paracha, Sohail; Mughal, Hammad; Ayesha, Annam
    Abstract: Over the past decade Pakistan remained involved in two major trade agreements with in the South Asia (Pakistan & Sri-Lanka FTA and SAFTA). It is meaningful from an operational and policy perspective to evaluate Pakistan's trade performance in South Asia against its objectives of greater trade integration and suggest policy interventions to improve its effectiveness. In order to achieve this objective, current study evaluates the Pakistan’s overall and chapter-wise trade performance with SAARC major SAARC economies for the last seven years (2003-09). This study has been disaggregated into two parts: In the first part of the study, an assessment of trade performance of SAARC members is carried out with respect to the rest of the world. Pakistan's trade performance vis-à-vis other SAARC members is the focus of this part. In the second part Pakistan’s trade performance in South Asia has been analyzed and policy interventions have been suggested to improve its effectiveness. Certain trade indicators like Trade Complementarity Index (TCI), Trade Specialization Index (TSI), Grubel Lloyd Index (GLI), Revealed Comparative Analysis (RCA), Bilateral Revealed Comparative Analysis BRCAs and Revealed Market Access (RMA) have been employed to achieve the above objectives.
    Keywords: International Trade; Regionalism
    JEL: F15 F0
    Date: 2011–06–09
  11. By: Cecília Hornok
    Abstract: Timeliness has gained growing importance in international trade. This paper provides empirical evidence on the significant cost of time in trade by exploiting the quasi-experimental nature of the European Union (EU) enlargement in 2004. It applies a difference-in-difference-in-differences econometric strategy on a European industry-level database of bilateral trade barriers, where industries are differentiated according to their time sensitivity. The use of a treatment intensity indicator that captures the decline in the waiting time at borders supports the identification. Results are cross-checked on subsamples defined along transport mode choice probabilities, where intra-EU transport mode choice projections are obtained from an estimated discrete choice model on extra-EU trade. Robustness checks experiment with alternative definitions of treatment sensitivity and treatment intensity.
    Keywords: time cost of trade, difference-in-difference-in-differences estimation, treatment intensity, EU enlargement, transport mode choice
    JEL: F13 F14 F15
    Date: 2011–04
  12. By: Anca D. Cristea; David Hummels; Laura Puzzello; Misak G. Avetisyan
    Abstract: We collect extensive data on worldwide trade by transportation mode and use this to provide detailed comparisons of the greenhouse gas emissions associated with output versus international transportation of traded goods. International transport is responsible for 33 percent of world-wide trade-related emissions, and over 75 percent of emissions for major manufacturing categories like machinery, electronics and transport equipment. US exports intensively make use of air cargo; as a result two-thirds of its export-related emissions are due to international transport, and US exports by themselves generate a third of transport emissions worldwide. Inclusion of transport dramatically changes the ranking of countries by emission intensity. US production emissions per dollar of exports are 16 percent below the world average, but once we include transport US emissions per dollar exported are 59 percent above the world average. We use our data to systematically investigate whether trade inclusive of transport can lower emissions. In one-quarter of cases, the difference in output emissions is more than enough to compensate for the emissions cost of transport. Finally, we examine how likely patterns of trade growth will affect modal use and emissions. Full liberalization of tariffs and GDP growth concentrated in China and India lead to transport emissions growing much faster than the value of trade, due to trade shifting toward distant trading partners. Emissions growth from growing GDP dwarfs any growth from tariff liberalization.
    JEL: F17 F18 Q56
    Date: 2011–06
  13. By: Yuqing Xing (National Graduate Institute for Policy Studies)
    Abstract: China's leading position in high-tech exports is a myth created by outdated trade statistics, which are inconsistent with the trade based on global supply chains. Assembled high-tech products, made with imported key parts and components, accounted for 82% of China's high-tech exports. Current trade statistics mistakenly credit entire values of these assembled products to China, thus greatly inflate the export value. For instance, in 2009 China's export in the iPhone amounted US$4.6 billion, of which only 3.6% was the value added by Chinese workers; its annual export in laptop PC valued at US$52 billion, but assembly accounted for only 3% of the gross value. In addition, 83% of China's high-tech exports was attributed to foreign invested firms, in particular Taiwanese owned companies. Taiwan-IT companies have relocated 95% of their production/assembly capacity into and transferred mainland China to a top assembler of information and communication technology, such as laptop PCs, digital cameras and all i-products.
    Keywords: China, high-tech, value added, iPhone
    Date: 2011–06
  14. By: Cooke, Edgar F A
    Abstract: In this paper we study the impact of AGOA and CBTPA preferences on the African and Caribbean Basin beneficiaries respectively. Our methodology consists of modelling the selection in exporting that occurs and to account for the zero trade occurring at the HS 6 digit level of disaggregation used in the paper. The AGOA impact has in the literature been found to be driven mainly by apparel and textiles and oil and energy related products. We however, do find a strong impact of the AGOA and CBTPA preferences for the beneficiary countries.
    Keywords: Trade preference regimes; African Growth and Opportunity Act (AGOA); Caribbean Basin Initiative (CBI); Africa; Latin America and Caribbean; international trade; Generalised System of Preferences (GSP)
    JEL: F13 F10 F19
    Date: 2011–06–11
  15. By: Jäkel, Ina C.; Smolka, Marcel
    Abstract: This paper studies to what extent individuals form their preferences towards trade policies along the lines of the Stolper-Samuelson logic. We employ a novel international survey data set with an extensive coverage of high-, middle-, and low-income countries, address a subtle methodological shortcoming in previous studies and condition on aspects of individualenlightenment. We find statistically significant and economically large Stolper-Samuelson effects. In the United States, being high-skilled increases an individual's probability of favoring free trade by up to twelve percentage points, other things equal. In Ethiopia, the effect amounts to eight percentage points, but in exactly the opposite direction. --
    Keywords: Trade policy,Voter preferences,Political economy
    JEL: F11 F13
    Date: 2011
  16. By: Adolfo Cristobal-Campoamor (ISET, Tbilisi); Osiris Jorge Parcero (United Arab Emirates University)
    Abstract: This paper proposes a 2-country 3-region economic geography model that can account for the most salient stylized facts experienced by Eastern European transition economies during the period 1990-2005. In contrast to the existing literature, which has favored technological explanations, trade liberalization is the only driving force. The model correctly predicts that in the first half of the period trade liberalization led to divergence in GDP per capita, both between the West and the East and within the East. Consistent with the data, in the second half of the period, this process was reversed and convergence became the dominant force.
    Date: 2011–05
  17. By: Laborde, David; Martin, Will; van der Mensbrugghe, Dominique
    Abstract: This paper uses detailed data on bound and applied tariffs to assess the consequences of the World Trade Organization’s December 2008 Modalities for tariffs levied and faced by developing countries, and the welfare implications of these reforms. The authors find that the tiered formula for agriculture would halve tariffs in industrial countries and lower them more modestly in developing countries. In non-agriculture, the formulas would reduce the tariff peaks facing developing countries and cut average industrial country tariffs by more than a third. The authors use a political-economy framework to assess the implications of flexibilities for the size of the tariff cuts and find they are likely to substantially reduce the outcome. However, despite the flexibilities, there are likely to be worthwhile gains, with applied tariffs facing developing countries cut by about 20 percent in agriculture and 27 percent in non-agriculture, and sizeable cuts in tariffs facing industrial countries. The welfare impacts of reform are evaluated using a new approach to aggregation that improves on the traditional, flawed approach of weighted-average tariffs. This substantially increases the estimated benefits of an agreement along the lines of these modalities, with estimated global income gains of up to $160 billion per year from market access reform.
    Keywords: International Trade and Trade Rules,Agribusiness,Free Trade,Trade Policy,Debt Markets
    Date: 2011–06–01
  18. By: Christian Schwarz; Kristian Giesen
    Abstract: We extend the Behrens et al. (2009) general equilibrium heterogeneous firms framework by horizontal foreign direct investment. The model features endogenously determined firm entrants, wages, productivity cutoff s, flexible price markups and allows for wage differentials across countries in equilibrium. The framework is especially suitable to analyze the welfare consequences of attracting FDI since it allows to study through which channels FDI might raise welfare - including the not yet explored impact on the wage differential and the price markups. From a policy perspective we compare a strategic and a cooperative FDI policy scenario and find that supranational coordination leads to welfare gains.
    Keywords: Multinational firms, FDI, firm heterogeneity
    JEL: F12 F23
    Date: 2011–04
  19. By: Irene Brambilla (Universidad Nacional de La Plata, Universidad de San Andrés y NBER); Rafael Dix Carneiro (Princeton University); Daniel Lederman (The World Bank); Guido Porto (Universidad Nacional de La Plata)
    Abstract: The returns to schooling and the skill premium are key parameters in various elds and policy debates, including the literatures on globalization and inequality, international migration, and technological change. This paper explores the skill premium and its correlation with exports in Latin America, thus linking the skill premium to the emerg- ing literature on the structure of trade and development. Using data on employment and wages for over seven million workers from sixteen Latin American economies, the authors estimate national and industry-specic returns to schooling and skill premi- ums and study some of their determinants. The evidence suggests that both country and industry characteristics are important in explaining returns to schooling and skill premiums. The analyses also suggest that the incidence of exports within industries, the average income per capita within countries, and the relative abundance of skilled workers are related to the underlying industry and country characteristics that explain these parameters. In particular, sectoral exports are positively correlated with the skill premium at the industry level, a result that supports recent trade models linking exports with wages and the demand for skills.
    Keywords: industry skill premium, industry exports, Latin America
    JEL: F13 F14
    Date: 2011–06
  20. By: Marius Brülhart; Céline Carrère; Federico Trionfetti
    Abstract: We study the response of regional employment and nominal wages to trade liberalization, exploiting the natural experiment provided by the opening of Central and Eastern European markets after the fall of the Iron Curtain in 1990. Using data for Austrian municipalities, we examine differential pre- and post-1990 wage and employment growth rates between regions bordering the formerly communist economies and interior regions. If the "border regions" are defined narrowly, within a band of less than 50 kilometers, we can identify statistically significant liberalization effects on both employment and wages. While wages responded earlier than employment, the employment effect over the entire adjustment period is estimated to be around three times as large as the wage effect. The implied slope of the regional labor supply curve can be replicated in an economic geography model that features obstacles to labor migration due to immobile housing and to heterogeneous locational preferences.
    Keywords: trade liberalization; spatial adjustment; regional labor supply; natural experiment
    JEL: F15 R11 R12
    Date: 2011–06
  21. By: Vaqar , Ahmed; Ghulam , Samad
    Abstract: This study outlines the role of trade facilitation in Pakistan for economic corridors in South Asia. We study the current state of trade related infrastructure in Pakistan and its connectedness particularly with Afghanistan and India. The implications of recently initiated Afghanistan – Pakistan transit trade agreement are discussed. Current impediments in expanding trade relations with India are revisited. A perception survey reveals the issues faced by importers and exporters particularly those dealing with Afghanistan and India. We also held detailed focus group discussions where government functionaries and commercial counselors also participated. The policy recommendations are grounded in existing literature and survey results. The report has highlighted the required improvements in infrastructure arrangements to facilitate trade for fostering cooperation in South Asia between Pakistan, Afghanistan and India. However, trade facilitation also requires harmonizing customs procedures and harmonizing the regulatory framework of other controlling authorities at the border crossings. Linkages need to be established among the customs organizations of the respective countries to exchange data so that export document of one country could serve as the import document of the other country. The phytosanitary and other quality standard of the countries need to be exchanged and harmonized to the extent possible to eliminate the technical barriers to trade. Finally the relations between India and Pakistan must be broad-based and allow guarantee towards non-reversal of a liberalized bilateral trading environment. Towards achieving this objective governments on both sides must be helped by the business community and civil society. Pakistan must also realize that while additional investment in trade infrastructure is necessary for sustaining economic growth, an equal emphasis is required to address issues that keep the existing infrastructure underutilized. In its overall infrastructure score, Pakistan is almost in line with its regional competitors, however it fares poorly when it comes to organizing and managing the already available assets.
    Keywords: Trade facilitation; economic growth; economic corridors
    JEL: F15
    Date: 2011–05
  22. By: Klaus-Bernhard Michel; François Rycx
    Abstract: Offshoring is generally believed to be productivity-enhancing and this belief is underpinned by economic theory. This article contributes to the growing literature that tests empirically whether offshoring does indeed help to improve productivity. Estimating the impact of materials and business services offshoring on productivity growth with industry-level data for Belgium over the period 1995-2004, we examine this issue separately for manufacturing and market services. The results show that there is no productivity effect of materials offshoring, while business services offshoring leads to productivity gains in manufacturing. In addition, this is the first article to investigate the possibility of spillovers from offshoring. Productivity gains from offshoring in one industry may feed through to other industries that purchase its output for intermediate use if, due to offshoring, the user value exceeds the price of the output. There is only scarce evidence of positive spillovers from materials offshoring in manufacturing in the data, which suggests that most firms effectively manage to internalise all efficiency gains from offshoring.
    Keywords: offshoring; productivity; spillovers; manufacturing and services; gmm
    JEL: J00 O10
    Date: 2011–06
  23. By: Barbara Pistoresi; Alberto Rinaldi
    Abstract: This paper investigates the relationship between real export and real GDP in Italy from 1863 to 2004 by using cointegration analysis and causality tests. The outcome suggests that these variables comove in the long run but the direction of causality depends on the level of economic development: in the period prior to WW1 the growth of the Italian economy led that of exports, while in the post-WW2 period the causal relationship was reversed with the expansion of exports that determined the growth of the Italian economy
    Keywords: Export led growth hypothesis, unit root tests, cointegration analysis, Granger – causality
    JEL: F43 O11 N1 N7
    Date: 2011–05

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