nep-int New Economics Papers
on International Trade
Issue of 2015‒12‒01
twenty-six papers chosen by
Luca Salvatici
Università degli studi Roma Tre

  1. Do firms learn by exporting or learn to export? Evidence from Senegalese manufacturing plant By Cié Fatou; Ji Eun Choi
  2. Agriculture in the Transatlantic Trade and Investment Partnership: Tariffs, Tariff-Rate Quotas, and Non-Tariff Measures By Beckman, Jayson; Arita, Shawn; Mitchell, Lorraine; Burfisher, Mary
  3. Determinants of Trade Margins: Insights Using State Export Data By Coughlin, Cletus C.; Bandyopadhyay, Subhayu
  4. Estimating the Effects of Selected Sanitary and Phytosanitary Measures and Technical Barriers to Trade on U.S.-EU Agricultural Trade By Arita, Shawn; Mitchell, Lorraine; Beckman, Jayson
  5. Quality and the Great Trade Collapse By Chen Natalie; Juvenal, Lucianaauthor-workplace-Name: International Monetary Fund
  6. Foreign Direct Investment as a Signal By Koska, Onur A.; Long, Ngo Van; Staehler, Frank
  7. Quality and the Great Trade Collapse By Chen, Natalie; Juvenal, Luciana
  8. Assessing the Impact of Non-Tariff Barriers in the EEU: Results of Enterprise Surveys By Vinokurov, Evgeny; Demidenko, Mikhail; Pelipas, Igor; Tochitskaya, Irina; Shymanovich, Gleb; Lipin, Andrey
  9. A Model of Competition between Multinationals By Koska, Onur A.
  10. The Political Economy of Preferential Trade Arrangements: An Empirical Investigation By Giovanni Facchini; Peri Silva; Gerald Willmann
  11. Is Ghana achieving sustainable trade balance in the participation of international trade? time series assessment for Ghana By Antwi-Boateng, Cosmos
  12. Too Small To Protect? The Role of Firm Size in Trade Agreements By Matthew Cole; Ben Zissimos
  13. Trade Potential Revisited: A Panel Data Analysis For Zimbabwe By Enrique Martínez-Galán; Isabel Proença; Maria Paula Fontoura
  14. The Myth of Profit-Shifting Trade Policies By Koska, Onur A.; Staehler, Frank
  15. Trade and frictional unemployment in the global economy By Robert-Nicoud, Frédéric; Carrere, Céline; Grujovic, Anja
  16. Supply Function Competition and Exporters: Nonparametric Identification and Estimation of Productivity Distributions and Marginal Costs By Quang Vuong; Ayse Pehlivan
  17. The Impact of Regional Integration on Intra-Arab Trade in Agrifood Commodities: A Panel Data Approach By Abu Hatab, Assem
  18. Dimensões da Abordagem da Cadeia Global de Valor: upgrading, governança, políticas governamentais e propriedade intelectual By Eduardo Costa Pinto; Ronaldo Fiani; Ludmila Macedo Corrêa
  19. Trade, Ineqality and Costly Redistribution By Oleg Itskhoki; Alonso de Gortari; Pol Antras
  20. Estimating the Economic Effects of Reducing Non-Tariff Barriers in the EEU By Vinokurov, Evgeny; Demidenko, Mikhail; Pelipas, Igor; Tochitskaya, Irina; Shymanovich, Gleb; Lipin, Andrey; Movchan, Veronika
  21. Risk sharing in a world economy with uncertainty shocks By Robert Kollmann
  22. Productivity, resource endowment and trade performance of the wood product sector. By Bertrand M. Koebel; Anne-Laure Levet; Phu Nguyen-Van; Indradev Purohoo; Ludovic Guinard
  23. Designing a Reasonable Regulation on Foreign Investments from State-owned Enterprises and Sovereign Wealth Funds (Japanese) By ITO Kazuyori
  24. Migrants' Remittances: Channelling Globalization By Anghel, Remus Gabriel; Piracha, Matloob; Randazzo, Teresa
  25. Innovative work practices, ICT use and employees' motivations By MARTIN Ludivine
  26. Migration, Transfers and Child Labor By Ralitza Dimova; Gil S. Epstein; Ira N. Gang

  1. By: Cié Fatou; Ji Eun Choi
    Abstract: The increasing quantity of literature investigating the impact of trade openness on firm efficiency has not yet provided a definite prediction of the direction of causality. This paper investigates how the relationship between exporting and productivity impacts on manufacturing sectors in Senegal. Using unique firm-level panel data for the period 1998.2011, we estimate productivity and exporting dynamics, controlling for other unobserved effects, and using General Method of Moments. Our results indicate evidence both that the most efficient firms self-select for entry into the export market and that learning has an impact on the export market. From a policy perspective, this evidence of learning by exporting suggests Senegal has much to gain from encouraging exports by helping domestic firms overcome barriers to entering foreign markets, particularly by investing in skilled workers and promoting access to patents and licenses
    Keywords: exporting, total factor productivity, learning by exporting, general method of moment; Economic assistance and foreign aid, Infrastructure (Economics), Millennium Development Goals
  2. By: Beckman, Jayson; Arita, Shawn; Mitchell, Lorraine; Burfisher, Mary
    Abstract: The proposed Transatlantic Trade and Investment Partnership (T-TIP) between the United States and the European Union (EU) aims to address several important barriers facing agricultural trade, including tariffs, tariff-rate quotas (TRQs), and non-tariff measures (NTMs). Estimated ad valorem tariff equivalents of tariffs/TRQs and NTMs currently in place are as high as 120 percent, significantly limiting trade between the two regions. This study uses model simulations to assess the effects of T-TIP on agriculture under three broad scenarios: complete removal of tariffs and TRQs; elimination of select NTMs along with tariffs and TRQs; and a lowering of the willingness of consumers to purchase imported goods previously limited by NTMs. Results of all scenarios suggest an increase in U.S.-EU agricultural trade from T-TIP, benefiting both regions. While the United States realizes a relative increase in agricultural exports, the EU benefits from lower import prices and larger macroeconomic gains than the United States. The estimated annual increase in U.S.-EU agricultural trade ranges from $6.3 billion to $11.6 billion when compared with the 2011 base year.
    Keywords: Agricultural trade, trade Agreement, Transatlantic Trade and Investment Partnership, T-TIP, computable general equilibrium (CGE) model, non-tariff measures (NTMs), gravity model, United States, European Union, tariff rate quotas (TRQs), Agribusiness, Agricultural and Food Policy, International Relations/Trade, Livestock Production/Industries,
    Date: 2015–11
  3. By: Coughlin, Cletus C. (Federal Reserve Bank of St. Louis); Bandyopadhyay, Subhayu (Federal Reserve Bank of St. Louis)
    Abstract: We adapt the heterogeneous firm trade models of Helpman, Melitz, and Rubinstein (2008) and Lawless (2010) to analyze extensive and intensive trade margins using state-level exports to foreign nations. Our theoretical analysis provides definitive predictions for the effects of changes in fixed costs, variable costs, and foreign income on the extensive margin, while for the intensive margin the predictions regarding changes in fixed costs are definitive, but the effects of changes in variable costs and foreign income are not. The number of exporting firms of a state is used to measure the extensive margin, while the intensive margin is approximated by the average firm exports of a state. Various count-data models, such as the standard negative binomial and its hurdle extension, are used to address non-trading pairs and overdispersion in the extensive trade estimations, while a Heckman correction is examined to handle sample selection issues in the intensive margin estimations. As the theory predicts, we find more consistent and statistically significant effects of changes in cost-related variables on the extensive than on the intensive margin of trade. Unlike Lawless (2010), but consistent with a truncated Pareto distribution, empirical findings suggest that variable costs reduce average exports. A noteworthy finding is that U.S. foreign direct investment has a positive effect on both margins.
    Keywords: state exports, extensive margin, intensive margin, negative binomial, hurdle model, Heckman correction
    JEL: F10 R10
    Date: 2015–11
  4. By: Arita, Shawn; Mitchell, Lorraine; Beckman, Jayson
    Abstract: This study investigates the effects of selected sanitary and phytosanitary measures (SPS) and technical barriers to trade (TBT) on agricultural trade between the United States and the European Union (EU). It identifies data, methodological, and conceptual challenges to quantify such non-tariff measures (NTM) in the context of free-trade agreements. An empirical strategy combining market analysis with gravity model econometric methods is used to quantify the extent of protection afforded by major NTMs in U.S.-EU agricultural trade. In most of the commodities investigated with specific SPS/TBT concerns, estimated ad valorem tariff equivalents (AVE) of NTMs were found to be considerably higher than existing tariffs. EU NTMs on U.S. poultry, pork, and corn were found to have the most trade-impeding effects, with estimated AVE effects of 102, 81, and 79 percent, respectively; EU NTMs on U.S. beef, vegetables, and fruits were also found to be significant. The AVE effect of U.S. NTMs on EU exports ranges from 37 percent for vegetables to 45 percent for fruits.
    Keywords: Non-tariff measures, NTMs, gravity model, agricultural trade, trade agreement, Transatlantic Trade and Investment Partnership, T-TIP, United States, European Union, EU, sanitary and phytosanitary measures, SPS, technical barriers to trade, TBT, Agribusiness, Agricultural and Food Policy, International Relations/Trade, Livestock Production/Industries,
    Date: 2015–11
  5. By: Chen Natalie (Department of Economics University of Warwick); Juvenal, Lucianaauthor-workplace-Name: International Monetary Fund
    Abstract: We explore whether the global financial crisis has had heterogeneous effects on traded goods differentiated by quality. Combining a dataset of Argentinean firm-level destination-specific wine exports with quality ratings, we show that higher quality exports grew faster before the crisis, but this trend reversed during the recession. Quantitatively, the effect is large: up to nine percentage points difference in trade performance can be explained by the quality composition of exports. This flight from quality was triggered by a fall in aggregate demand, was more acute when households could substitute imports by domestic alternatives, and was stronger for smaller firms’ exports.
    JEL: F10 F14
    Date: 2015
  6. By: Koska, Onur A.; Long, Ngo Van; Staehler, Frank
    Abstract: This paper models competition among multinational firms in an environment of firm heterogeneity, incomplete cost information and strategic interaction. In this context, FDI serves as a signal of productivity: when firms sort into exporters and multinationals, they also show whether they have low or high productivity. We show that the signaling effect of FDI increases the FDI incentive as firms would like to avoid sending a low productivity signal.
    Keywords: Foreign Direct Investment; Trade; Firm Heterogeneity; Incomplete Information; Signaling
    JEL: F23
    Date: 2015–10–27
  7. By: Chen, Natalie (University of Warwick, CAGE, CESifo and CEPR); Juvenal, Luciana (International Monetary Fund)
    Abstract: We explore whether the global financial crisis has had heterogeneous effects on traded goods differentiated by quality. Combining a dataset of Argentinean firm-level destination-specific wine exports with quality ratings, we show that higher quality exports grew faster before the crisis, but this trend reversed during the recession. Quantitatively, the effect is large: up to nine percentage points difference in trade performance can be explained by the quality composition of exports. This flight from quality was triggered by a fall in aggregate demand, was more acute when households could substitute imports by domestic alternatives, and was stronger for smaller firms’ exports.
    Keywords: Exports, heterogeneity, multi-product Firms, quality, trade collapse, unit values, wine. JEL Classification: F10, F14, F41
    Date: 2015
  8. By: Vinokurov, Evgeny; Demidenko, Mikhail; Pelipas, Igor; Tochitskaya, Irina; Shymanovich, Gleb; Lipin, Andrey
    Abstract: After the establishment of the Customs Union (CU) and the Single Economic Space (SES), Belarus, Kazakhstan and Russia have repeatedly stated the need to eliminate exemptions, limitations, and barriers to mutual trade in goods and services. This report represents the first stage of a study on the economic impact of reduction within the SES and the emerging Eurasian Economic Union (EEU) of non-tariff barriers (NTBs) to trade among Member States. It gives an overview of works on the definition and classification of NTBs, and the quantitative assessment and calculation of the economic effects of NTBs reduction. The report also presents the results of surveys and interviews with enterprises and companies of Belarus, Kazakhstan, and Russia that export goods and services to the markets of the CU and EEU. These surveys and interviews revealed respondents’ views on the NTBs they face when exporting to each of the partner states. They also obtained quantitative estimates of NTBs as a percentage of the value of exported goods, which made it possible to estimate the costs of each of the NTBs to the enterprises.
    Keywords: Non-Tariff Barriers; Enterprises; Eurasian Economic Union; Trade; Single Economic Space
    JEL: F02 F1 F15 F4
    Date: 2015
  9. By: Koska, Onur A.
    Abstract: This study models competition between multinationals, sequentially entering the same market, and analyzes how they choose their entry modes between trade, greenfield investment and acquisition, and how competition amongst them affects their choices. I discuss two important factors that lead a multinational whether or not to acquire a local firm: the intensity of pre- and post-acquisition competition. The former determines both the acquisition price and the profitability of the next best alternative entry mode, whereas the latter determines the extent of business stealing by the rival. The results point to a non-linear relationship between trade and investment liberalization and foreign direct investment.
    Keywords: Market Entry; Foreign Direct Investment; Acquisition; Trade
    JEL: D21 F23 L13
    Date: 2014–11–23
  10. By: Giovanni Facchini; Peri Silva; Gerald Willmann
    Abstract: In this paper, we develop a political economy model to study the decision of representative democracies to join a preferential trading arrangement (PTA), distinguishing between free trade areas (FTA) and customs unions (CU). Our theoretical analysis suggests that income inequality and bilateral trade imbalances are important factors in determining the formation of PTAs, while it points out that differences in the production structure among prospective member countries is an important factor in determining whether a CU or an FTA will emerge in equilibrium. Our empirical analysis, covering a sample of 124 countries over the period 1950-2000, lends strong support for the predictions of the model.
    Keywords: Free Trade Areas, Customs Unions, Trade Imbalances, Income Inequality
    Date: 2015
  11. By: Antwi-Boateng, Cosmos
    Abstract: This paper examines the long run relationship between exports and imports for Ghana during the period 1961 and 2013. Using the Johansen cointegration test, it is found that export and imports are cointegrated irrespective of the variable that is dependent. The results indicate a stable long run link between export and import. The results indicate Ghana’s macroeconomic policies have been effective in the long run and suggest that Ghana is not in violation of its international budget constraint. Future studies should examine the direction of causality and the issue of structural breaks.
    Keywords: Export, Import, Johansen cointegration, long run
    JEL: C22 F1 F15
    Date: 2015–08–12
  12. By: Matthew Cole (California Polytechnic State University.); Ben Zissimos (Department of Economics, University of Exeter)
    Abstract: This paper develops a new model of a trade agreement that puts at center stage the competing interests between firms within a sector. Larger firms favor trade liberalization whereas smaller firms favor protection. Lobbying by firms for or against the agreement is modelled as an all-pay auction, thus incorporating the feature that binding contracts over contributions for policies cannot be written. A new motive for trade agreement formation is uncovered in this framework whereby governments’ incentives to liberalize are driven by the lobbying process. If a proposed agreement is over non-tariff barriers then it always entails free trade. If a proposed agreement is over tariffs then it either entails free trade, which maximizes lobbying revenue, or the tariff revenue maximizing tariff. This outcome is supported by the surprising result that, off the equilibrium path, any tariff agreement that entails lobbying and positive tariffs yields lower expected revenue for the government than a free trade agreement involving no tariff revenue.
    Keywords: All-pay auction, firm heterogeneity, non-tariff barriers, tariffs, trade agreement.
    JEL: F02 F12 F13 D44
    Date: 2015
  13. By: Enrique Martínez-Galán; Isabel Proença; Maria Paula Fontoura
    Abstract: This paper notes that previous results on trade potential based on a panel data set may be biased and proposes the adequate Poisson Pseudo Maximum Likelihood method to estimate trade potential based on the elasticity estimates generated by a gravity model, with conclusions on trade potential based on confidence intervals estimated with the Delta method. This approach had not been yet considered in the literature for panel data. This methodology is used to evaluate Zimbabwe export potential in a period characterized by strong restrictions on trade, based on the elasticity estimates generated by an augmented gravity model for six Southern African Development Community member countries and their exports to the rest of the world. Results show that Zimbabwe has a large unexploited trade potential which will not be realized without political stability and structural reforms. For comparison purposes, we also present the gravity coefficients calculated with other estimation methods.
    Keywords: fiscal sustainability, causality, impulse response functions, time-varying coefficients, fiscal rules, logistic model
    JEL: F14 F15 F16
    Date: 2015–11
  14. By: Koska, Onur A.; Staehler, Frank
    Abstract: Since Dixit (1984), it is well accepted that a home country's best policy is to ban imports in an oligopolistic market if the resulting monopoly has a cost advantage over imports. This note (i) provides a formal proof and (ii) extends this result to symmetric firms. When domestic instruments are available, the optimal policy in a non-cooperative game is to subsidize local production such that it completely replaces imports. This policy is also globally first-best.
    Keywords: Import tariffs, export subsidies, profit shifting
    JEL: F13
    Date: 2014–11–10
  15. By: Robert-Nicoud, Frédéric; Carrere, Céline; Grujovic, Anja
    Abstract: We develop a multi-country, multi-sector trade model with labor market frictions and equilibrium unemployment. Trade opening leads to a reduction in unemployment if it raises real wages and reallocates labor towards sectors with lower-than-average labor market frictions. We estimate sector-specific labor market frictions and trade elasticities using employment data from 25 OECD countries and worldwide trade data. We then quantify the potential unemployment and real wage effects of implementing the Transatlantic Trade and Investment Partnership (TTIP) or the Trans-Pacific Partnership (TPP), and of eliminating trade imbalances worldwide. The unemployment and real wage effects work in conflicting directions for some countries under some trade regimes, such as the US under TTIP. We introduce a welfare criterion that accounts for both effects and splits such ties. Accordingly, US welfare is predicted to decrease under TTIP and increase under TPP.
    JEL: F15 F16 F17 J64
    Date: 2015
  16. By: Quang Vuong (New York University); Ayse Pehlivan (Bilkent University)
    Abstract: In this paper we develop a structural model in which exporters are competing in supply functions and study the nonparametric identification and estimation of productivity distributions and marginal costs in this framework using disaggregated bilateral trade data. Our model is able to reconcile the existence of multiple sellers, multiple prices, and variable markups that we observe in data and also incorporates features such as strategic pricing and incomplete information. Our identification and estimation methodology gains insights from methodologies used in empirical auctions. Our identification and estimation methodology makes an important contribution to the empirical auction literature by showing that the underlying structure is identified nonparametrically even if we do not observe the entire schedules, but only the transaction points instead; whereas the methodology in the literature of empirical auctions depends heavily on the fact that the entire bid/supply schedule is observed. Moreover, in view of the recent studies in international trade that have shown the sensitivity of the gains from trade estimates to the parametrization of productivity distributions, maintaining a flexible structure for productivity distributions is very important. We apply our model to the German market for manufacturing imports for 1990 using disaggregated bilateral trade data, which consists only of trade values and traded quantities. We recover the destination-source specific productivity distributions and destination-source specific marginal cost functions nonparametrically. Our empirical results do not support the distributional assumptions that are commonly made in the international trade literature such as Fréchet and Pareto. In particular, we find that the productivity distributions are not unimodal; low productivities are more likely to occur as expected, but there is not a single mode. Our results provide important insights about cross country and cross destination differences in productivity distributions, trade costs and markups.
    Date: 2015
  17. By: Abu Hatab, Assem
    Abstract: This paper assesses the impact of Arab integration arrangements on intra-Arab Agrifood trade. The main results indicate that Arab regional integration efforts have been ineffective in promoting Agrifood trade flows among the Arab countries. The results also show that actual intra-Arab Agrifood trade is consistently lower than the predicted values by the gravity model. Furthermore, Arab sub-regional trade agreements have had a modest impact on intra-Arab Agrifood trade. Taken together, these findings suggest that i) there is untapped trade potential in agricultural and food commodities among the Arab countries and thus they could potentially attain deeper levels of Agrifood trade integration, and ii) despite the significant progress that has been made over the past two decades in lowering tariff barriers, Agrifood trade among Arab countries has remained below its potential which in turn points out to the existence of non-tariff barriers that restrain the trade effects of Arab economic integration.
    Keywords: Regional trade integration, intra-Arab trade, Agrifood trade, panel data.
    JEL: C1 F02 F15 F33
    Date: 2015–02–05
  18. By: Eduardo Costa Pinto; Ronaldo Fiani; Ludmila Macedo Corrêa
    Abstract: Este trabalho tem como objetivos: i) apresentar as principais dimensões da abordagem da cadeia global de valor (upgrading, governança e as políticas governamentais); e ii) analisar os impactos da proteção da propriedade intelectual sobre as possibilidades de upgrading dos países em desenvolvimento. Para tanto, buscou-se apresentar os principais aspectos do Agreement on Trade-Related Aspects of Intellectual Property Rights (Trips) e seus impactos sobre as possibilidades de upgrading. This paper aims to i) to present the main dimensions of the Global Value Chain approach (upgrading, governance and government policies); and ii) to investigate the impacts of intellectual property protection on the upgrading possibilities of developing countries by means of presenting of the main aspects of Trips (Agreement on Trade-Related Aspects of Intellectual) and its impacts.
    Date: 2015–11
  19. By: Oleg Itskhoki (Princeton University); Alonso de Gortari (Harvard University); Pol Antras (Harvard University)
    Abstract: This paper studies the welfare implications of trade liberalization in a model in which trade may increases income inequality, and in which redistribution policies are constrained by information frictions (as in Mirrlees 1971). We first consider an extreme case in which redistribution is not feasible, and study the model's quantitative implications for the effect of trade opening on aggregate income and on (standard measures of) inequality. Adopting a welfarist approach, we compute the welfare gains from trade according to social welfare functions featuring various degrees of inequality aversion. We next consider an environment in which redistribution is feasible but only via (non-linear) income taxation. More specifically, the government only observes agents' income but not their skills or other characteristics. We solve for the (constrained) optimal redistribution policy and show how it is affected by trade opening. We also re-compute the welfare effects from trade taking into account the redistributive and efficiency effects of the optimal tax policy. Even when evaluating the welfare effects of trade based purely on its effect on aggregate income, the resulting gains from trade are typically adjusted downwards whenever income taxes are set by an inequality-averse government.
    Date: 2015
  20. By: Vinokurov, Evgeny; Demidenko, Mikhail; Pelipas, Igor; Tochitskaya, Irina; Shymanovich, Gleb; Lipin, Andrey; Movchan, Veronika
    Abstract: The report provides the first comprehensive assessment of the effects of non-tariff barriers on mutual trade in the EEU and gives recommendations as to how to remove them. It is based on a poll of 530 Russian, Kazakh and Belarusian exporters. In the research non-tariff barriers are divided into two groups. The first group includes non-tariff barriers such as sanitary and phytosanitary measures, technical barriers to trade, quotas, prohibitions, and quantitative controls. The second group comprises price and competition controls (the institute of “special importers,” sale restrictions, restrictions on public procurement, various subsidies). The second group of barriers is often referred to as “sand in the wheels,” because it hinders the movement of goods and in principle can be fully removed. The authors have come to a conclusion that this very group of barriers possesses a more negative influence on trade. Therefore, the main policy efforts should be directed at removing “sand in the wheels” of mutual trade.
    Keywords: Non-Tariff Barriers; Trade; Eurasian Economic Union; Econometrics
    JEL: F02 F1 F15 F4
    Date: 2015
  21. By: Robert Kollmann
    Abstract: This paper analyzes the effects of output volatility shocks and of risk appetite shocks on the dynamics of consumption, trade flows and the real exchange rate, in a two-country world with recursive preferences and complete financial markets. When the risk aversion coefficient exceeds the inverse of the intertemporal substitution elasticity, then an exogenous rise in a country’s output volatility triggers a wealth transfer to that country, in equilibrium; this raises its consumption, lowers its trade balance and appreciates its real exchange rate. The effects of risk appetite shocks resemble those of volatility shocks. In a recursive preferences-complete markets framework, volatility and risk appetite shocks account for a noticeable share of the fluctuations of net exports, net foreign assets and the real exchange rate. These shocks help to explain the high empirical volatility of the real exchange rate and the disconnect between relative consumption growth and the real exchange rate.
    Keywords: External balance, exchange rate, volatility, risk appetite, consumption-real exchange rate anomaly.
    JEL: F31 F32 F36 F41 F43
    Date: 2015–11
  22. By: Bertrand M. Koebel; Anne-Laure Levet; Phu Nguyen-Van; Indradev Purohoo; Ludovic Guinard
    Abstract: This paper analyzes the determinants of international trade of wood products, considering three main groups: woodworking products, pulp and paper and wooden furniture. We extend the Heckscher-Ohlin-Vanek (HOV) framework in order to take into account the forest resource endowment as well as industrial performance factors. Empirical tests are based on data on European countries between 1995 and 2007. The HOV hypothesis is partially confirmed in that the forest resource endowment is a significant determinant for explaining differences in net trade of two products (pulp and paper and furniture) but not for woodworking products. In addition, empirical tests also show the limits of the HOV model for explaining international trade of wood products. Indeed, factors reflecting industrial performance of wood sectors, including total factor productivity and average labor cost, have a significant role in determining differences in net trade of wood products.
    Keywords: Heckscher-Ohlin-Vanek hypothesis; international trade; wood products, panel data.
    JEL: F10 L60 Q23
    Date: 2015
  23. By: ITO Kazuyori
    Abstract: During the last decade or so, the international investment activities of state-owned enterprises (SOEs) and sovereign wealth funds (SWFs) have attracted the attention of policymakers. There is a fear that these investments may be influenced by the geostrategic interests of their home countries rather than based on traditional profit-maximizing considerations. Since this could be a serious harm to the national security of host states, several governments have introduced a specific review procedure against the investments from SOEs and SWFs that is much stricter than usual. As a matter of fact, however, such a review system tends to be excessively restrictive, sometimes even arbitrary or protectionist, and invokes a serious chilling effect on foreign investors. This means a loss of opportunities for economic growth and job creation. Therefore, a policy challenge lies in how to ensure the freedom of investment while maintaining a policy space for screening foreign investments in the light of national security. In this respect, it would be required that due process principles such as transparency, non-discrimination, and accountability be applied even when the investors are SOEs and SWFs. This paper explores a reasonable design of review procedures on foreign investment made by SOEs and SWFs with an emphasis on how to balance the conflicting policy objectives, i.e., attracting foreign investment as much as possible while defending strategic sectors sufficiently.
    Date: 2015–11
  24. By: Anghel, Remus Gabriel (Romanian Institute for Research on National Minorities); Piracha, Matloob (University of Kent); Randazzo, Teresa (University of Kent)
    Abstract: In the past twenty years the ever-growing levels of migrants' remittances made state agencies, international organizations, scholars and practitioners to increasingly consider remittances as one of the main engines to promote globalization and growth in the developing world. By transferring home large amounts of money, information, ideas and practices, migrants and migrant organizations are often seen as able to produce significant changes in countries and localities of origin. Focusing on cases from former socialist countries and around the world, this paper discusses the main debates surrounding the effects and uses of migrant remittances. Furthermore, using different case studies from Europe and Asia, the paper addresses the notion of social remittances, namely the transfers of ideas, practices and norms between societies of origin and destination. It highlights the ideas and practices migrants transfer home, the types of social norms it generates, and the extent to which migration produces transformations in countries of origin.
    Keywords: remittances, social remittances, former socialist countries
    JEL: F22 F24
    Date: 2015–11
  25. By: MARTIN Ludivine
    Abstract: I investigate the impact of innovative work practices and of Information and Communication Technologies (ICT) on employees' motivations. While the existing literature assumes that their positive effects on performance are due to employees' motivation but only assess related concepts, this paper directly analyses employees' motivations. The data come from a cross-sectional survey conducted in 2013. The paper provides new and interesting results on how firms can build a motivational environment shaped by work practices and ICT. I resort to an original empirical framework that permits one to take into account the potential reverse causation between, on the one hand, the voluntary participation in innovative work practices and the use of ICT and motivations on the other. Within this framework, I modify what previous analyses reveal about quality circle and training participation. The results confirm the positive role of work practices such as teamwork, quality norms, formal appraisals, management recognition and family-friendly policies on employee's positive attitudes. Moreover, I introduce a large range of ICT compared to existing research and find that the ICT that most contributed to the development of a motivational environment are those that facilitate access to information and knowledge such as workflow, Internet and e-mail.
    Keywords: Innovative work practices; information and communication technologies; Employees' motivations
    JEL: J81 L23 M12 M54
    Date: 2015–11
  26. By: Ralitza Dimova (Institute of Development Policy AND Management, University of Manchester and IZA, Bonn.); Gil S. Epstein (Bar Ilan University, Ramat Gan and IZA, Bonn and CReAM, London.); Ira N. Gang (Rutgers University and IZA, Bonn, CReAM, London and IOS, Regensburg.)
    Abstract: We examine agricultural child labor in the context of emigration, transfers, and the ability to hire outside labor. We start by developing a theoretical background based on Basu and Van, (1998), Basu, (1999, 2000) and Epstein and Kahana (2008) and show how hiring labor from outside the household and transfers to the household might induce a reduction in children’s working hours. Analysis using Living Standards Measurement Survey (LSMS) data on the Kagera region in Tanzania lend support to the hypothesis that both emigration and remittances reduce child labor.
    Keywords: child labor, remittances, emigration, migration
    JEL: D62 F22 I30
    Date: 2015–11–25

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