|
on International Trade |
| By: | Andres Giraldo - Jesus Cañas; Jesus Cañas |
| Abstract: | This research explores empirically the causal link between international trade and economic growth within a free trade area. In particular, we use data from the North American Free Trade Agreement (NAFTA) to estimate the causal relationship between economic growth and trade flows, but isolating trade within the bloc from trade with the rest of the world. The period considered is 1960-2014. Our analysis follows three strategies: we investigate Granger causality on a one-country and two-countries basis and then we include the three countries in the same framework, following the identification strategy proposed by Arellano and Bover (1995). We find that both exports cause growth and growth drives exports. This goes in the same direction as that one followed in the literature. However, under the third strategy, we do not find conclusive evidence that supports the idea that trade within a trade bloc is more important for growth than trade with the rest of the world. Moreover, the long run effect is more significant for growth during the whole period than when NAFTA has been active. Regarding the impact of growth on exports, we find that production is important for enhancing exports within NAFTA in both short- and long-run but when the whole period is considered. |
| Keywords: | Dynamic Panel Data, NAFTA, Export-led growth hypothesis, Growth-driven exports hypothesis |
| JEL: | C23 F14 F43 O19 O24 O47 O51 O54 |
| Date: | 2016–10–07 |
| URL: | http://d.repec.org/n?u=RePEc:col:000416:015302&r=int |
| By: | Baybars Karacaovali (Department of Economics, University of Hawaii); Deveraux Talagi (Department of Economics, University of Hawaii) |
| Abstract: | This paper analyzes the international trade relations of the United States, Canada, and Mexico with the Trans-Pacific Partnership (TPP) member countries currently and historically in order to provide insights for TPP’s future effects provided it potentially comes into force. Using a gravity model estimation, we find that the existing free trade agreements (FTAs) between TPP countries (intra-TPP) and FTAs between TPP members and other countries (extra-TPP) have positively impacted trade in the 1980-2015 period. A successful completion of the TPP agreement promises to boost trade further. |
| Keywords: | International trade, gravity model, free trade agreements, Trans-Pacific Partnership |
| JEL: | F1 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:hai:wpaper:201701&r=int |
| By: | Carol Newman; John Rand; Finn Tarp |
| Abstract: | This paper explores the relationship between imports and firm productivity, focusing on imported intermediates. Using firm-level data on over 20,000 manufacturing firms in Viet Nam, we find evidence for competition-induced productivity gains from trade. We show that gains in intermediate sectors spill-over to downstream sectors such that firms using more inputs from import-intensive sectors experience higher productivity gains. The evidence indicates that the main source of spill-over is better quality, domestically produced inputs. Ignoring the gains from trade through this mechanism may significantly underestimate the impact of trade on productivity. |
| Keywords: | imports, supply chains, productivity, Viet Nam |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2016-090&r=int |
| By: | Mitra, Devashish (Department of Economics, Syracuse University); Pham, Cong S. (Department of Economics, Deakin University, Australia); Bandyopadhyay, Subhayu (Federal Reserve Bank of St. Louis) |
| Abstract: | This paper presents a theoretical model (adapted from the structural gravity model by Anderson and van Wincoop, 2003) to capture the effects of terrorism on air passenger traffic between nations affected by terrorism. We then use equations derived from this model, in conjunction with alternative functional forms for trade costs, to estimate the effects of terrorism on bilateral air passenger flows from 57 source countries to 25 destination countries for the period of 2000 to 2014. We find that an additional terrorist incident results in approximately a 1.2% decrease in the bilateral air passenger transport per unit distance while doubling of the accumulated terrorist incidents during the past 5 years reduces it by 18%. Terrorism adversely impacts the bilateral air passenger transport per unit distance both by reducing national output and especially by increasing psychological distress, which could be an important contributing factor in perceived travel costs. Last but not the least, we show that the responsiveness of international air travel to terrorism critically depends on the nature of the terrorist attacks. Specifically, international air passenger transport is found to be extremely sensitive to fatal terrorist attacks and terrorist attacks of targets such as airports, transportation or tourists. |
| Keywords: | air passengers; airline industry; gravity equation; international trade; terrorism |
| JEL: | F1 F14 L93 |
| Date: | 2017–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedlwp:2017-002&r=int |
| By: | Oxana Babecka Kucharcukova; Jan Bruha |
| Abstract: | In this paper we are interested in nowcasting and short-run forecasting of the main external trade variables. We consider four empirical methods: principal component regression, elastic net regression, the dynamic factor model and partial least squares. We discuss the adaptation of those methods to asynchronous data releases and to the mixed-frequency set-up. We contrast them with a set of univariate benchmarks. We find that for variables in value terms (both nominal and real), elastic net regression typically yields the most accurate predictions, followed by the dynamic factor model and then by principal components. For export and import prices, univariate techniques seem to have the higher precision for backcasting and nowcasting, but for short-run forecasting the more sophisticated methods tend to produce more accurate forecasts. Here again, elastic net regression dominates the other methods. |
| Keywords: | Dynamic factor models, elastic net regression, mixed-frequency data, nowcasting, principal component analysis, state space models, trade balance |
| JEL: | C53 C55 F17 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:cnb:wpaper:2016/11&r=int |
| By: | Vicente Pinilla (Universidad de Zaragoza and IA2); Agustina Rayes (Universidad Nacional del Centro de la Provincia de Buenos Aires and CONACYT) |
| Abstract: | The objective of this paper is to explain, from a cliometric perspective, the determinants of the growth of Argentina’s exports between 1880 and 1929. To do this, we have constructed a gravity model with the principal products exported each year by Argentina to its most important trading partners. In this way, we believe that this study constitutes a relevant and original contribution to the analysis of economic growth from a historical perspective and specifically in explaining the factors determining the export success of the settler countries during the first wave of globalisation. Our results show that Argentina’s export-led growth must be explained from both the supply and demand sides. We also find that the reduction in transatlantic transport costs boosted exports. |
| Keywords: | Settler Economies, Economic History of Argentina, First Globalization, Trade Gravity Models, Latin America Economic History |
| JEL: | F14 N56 N76 Q17 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:hes:wpaper:0107&r=int |
| By: | Sotiris Blanas; Adnan Seric; Christian Viegelahn |
| Abstract: | Using firm-level data, we study the differences in the quantity and quality of jobs offered by foreign-owned and domestic firms in Sub-Saharan Africa, and identify how country-level institutional factors determine these differences. After controlling for numerous firm-level characteristics in regressions, we find that foreign-owned firms, especially those whose main business purpose is to serve the home or foreign markets, offer more stable and secure jobs than domestic firms. Specifically, they have more permanent full-time workers, a lower probability of offering temporary work and employ less temporary workers. The job stability and security advantage of foreign-owned firms is smaller in countries with higher firing costs and governance quality, where domestic firms are induced to offer more stable and secure jobs. In addition, foreign-owned firms are less likely to offer unpaid work and have less of these workers. They also invest more in training, especially of managers, and pay higher wages to non-production and managerial workers, particularly those firms whose main business purpose is to serve the home or foreign markets. A higher wage to production workers is paid only by those whose owners are from high-income countries. The wage premia of foreign-owned firms are lower in countries with higher governance and social policy standards, where domestic firms are induced to pay higher wages. |
| Keywords: | Job quantity, Job quality, FDI, Institutions, Sub-Saharan Africa |
| JEL: | F14 F16 F21 F23 F66 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:lan:wpaper:152465485&r=int |
| By: | Kosse, Elijah; Devadoss, Stephen |
| Abstract: | This study develops a three-county trade model of the United States, Mexico, and Canada to analyze the effects of the 2013 Suspension Agreement on prices, production, consumption, trade flows, and welfare in each country due to the U.S. minimum import price on Mexican tomatoes. While only the United States and Mexico are signatories to the agreement, Canada was also included since the U.S. minimum price distorts prices across the region. Three tomato categories—field, greenhouse, and cherry & grape—are studied since each has a distinct minimum price. The overall welfare effects are positive for Mexico and Canada, but negative for the United States. |
| Keywords: | Canada, Mexico, Tomato Trade Agreement, the United States, Welfare Analysis, International Relations/Trade, F13, F14, |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:ags:saea17:252726&r=int |
| By: | Bakari, Sayef; Saaidia, Fatma |
| Abstract: | The link between exports, imports and economic growth in Italy has been extensively discussed by historiography. This paper investigates the relationship between exports, imports, and economic growth in Italy. In order to achieve this purpose, annual data were collected from the reports of the World Bank for the periods between 1960 and 2015, was tested by using Augmented Dickey-Fuller (ADF) stationary test, Co integration analysis of the Vector Auto Regression Model and the Granger-Causality tests. According to the empirical results, we found that exports and imports have not any effect on economic growth. Also, we discovered, according to the Granger-Causality tests that there is no any relationship of causality between trade and economic growth. However, and according to the results of the correlation analysis, we found that trade and economic growth in Italy are positively correlated, meaning that the strategy economic posing by Italy is not efficacious to solve economic problems. |
| Keywords: | Export, Import, Economic Growth, Correlation, Cointegration, VAR and Causality. |
| JEL: | F1 F10 F13 F14 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:76480&r=int |
| By: | Michal Paulus (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nabrezi 6, 111 01 Prague 1, Czech Republic); Eva Michalikova (Brno University of Technology, Brno, Czech Republic; Anglo-American Univesity, Prague, Czech Republic) |
| Abstract: | We propose a methodology for gravity models which overcomes weakness of institutional distance measures identified in international business literature (Shenkar, 2001). Our methodology is based on combination of the distance approach with cluster analysis of states according to their institutional level. The methodology reflects the critiques concerning symmetry, linearity and “discordance illusion” of traditional distance specification of institutional variables within gravity models and tries to bridge the gap between those two streams of literature. We also use the methodology to test the “middlemen hypothesis” theorising that intermediate corrupt countries can mediate the trade flows between low and high corrupt groups because they possess skills to succeed on both markets. To present the methodology and examine the hypothesis we estimate micro-founded augmented gravity model for bilateral exports of 131 countries within period 1995-2013. The model is estimated also on disaggregated data. The results confirm that the proposed methodology overcomes discussed weaknesses especially when we estimate the model on disaggregated data because we find significant heterogeneity between sectors. We conclude that when we are interested in causal claims about the impacts of institutions on trade we should abandon traditional distance specifications. However, we reject the middlemen hypothesis. |
| Keywords: | gravity model; corruption; institutional distance; middlemen hypothesis |
| JEL: | F14 F51 F55 M16 O17 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2016_26&r=int |
| By: | Amrita Bahri |
| Abstract: | Multiple scholarly works have argued that developing country Members of World Trade Organization (WTO) should enhance their dispute settlement capacity to successfully and cost effectively navigate the system of WTO Dispute Settlement Understanding (DSU). It is one thing to be a part of WTO agreements and know the WTO rules, and another to know how to use and take advantage of those agreements and rules in practice. The present investigation seeks to conduct a detailed examination of the latter with a specific focus on critically examining public private partnership (PPP) strategies that can enable developing countries to effectively utilize the provisions of WTO DSU. To achieve this purpose, the article examines how Brazil, one of the most active DSU users among developing countries, has strengthened its DSU participation by engaging its private stakeholders during the management of WTO disputes. The identification and evaluation of the PPP strategies employed by the government and industries in Brazil may prompt other developing countries to determine their individual approach towards PPP for the handling of WTO disputes. |
| JEL: | L81 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:68276&r=int |
| By: | Masahito Ambashi (Economic Research Institute for ASEAN and East Asia (ERIA)) |
| Abstract: | This policy brief presents an overview of the ASEAN economy in terms of its economic relationship with multinationals, particularly Japanese companies, that have long invested in this region. ASEAN has been an attractor of foreign direct investment (FDI). Business interest in ASEAN has increased again recently due to the (i) relatively low wage of ASEAN compared to China, (ii) establishment of the ASEAN Economic Community (AEC), (iii) economic partnership network with a core of ASEAN countries, (iv) large-scale market covered by ASEAN, and (v) rise of CLMV countries (Cambodia, Lao PDR, Myanmar, and Viet Nam). In these trends, ASEAN has established a reciprocal economic relationship with other countries and regions. To develop its economy, ASEAN member states are expected to further advance the AEC at a high level. Hence, ASEAN must address challenges such as deepening further economic integration and narrowing development gaps in the region. Most importantly, ASEAN still needs to increase the attractiveness of its 'whole region' as an essential and integral part of global value chains to draw further FDI. |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:era:wpaper:pb-2016-04&r=int |
| By: | Bakari, Sayef |
| Abstract: | This paper investigates the relationship between exports, imports, domestic investment and economic growth in Egypt. In order to achieve this purpose, annual data for the periods between 1965 and 2015 was tested by using Johansen co-integration analysis of Vector Auto-regression and the Granger-Causality tests. According to the result of the co-integration analysis, it was determined that there is no relationship between the four variables. The empirical results indicate that exports, imports and domestic investment have no effect on economic growth in Egypt. However, the result of causality test asserts that imports and domestic investment are the source of economic growth in Egypt. |
| Keywords: | Domestic Investment, Export, Import, Economic Growth, Egypt. |
| JEL: | F0 F1 F14 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:76627&r=int |
| By: | Stephen L. Magiera |
| Abstract: | Foreign investors can lodge a complaint against a host country for alleged treaty violations under the Investor-State Dispute Settlement (ISDS) provisions of bilateral investment treaties (BITs). The complaints are arbitrated internationally outside the host country's domestic court, sometimes involve claims exceeding US$1 billion, and give rise to significant financial risk of international arbitration for host countries. Because of this, Indonesia has recently cancelled many of its BITs. But at the same time, Indonesia has agreed to ISDS under the ASEAN Comprehensive Investment Agreement (ACIA) and ASEAN's five agreements with Dialogue Partners. Furthermore, President Joko Widodo has expressed strong interest in joining the Trans-Pacific Partnership (TPP), which contains provisions for ISDS. ASEAN's Regional Comprehensive Economic Partnership (RCEP) will also provide for ISDS. This note reviews the status of Indonesia's international obligations with respect to ISDS, evaluates some of the benefits and costs of ISDS, and reviews the extent to which Indonesia would be undertaking new ISDS obligations under TPP. The note concludes with a discussion of ways that Indonesia can reduce the risk of international arbitration through domestic regulatory reforms. |
| Keywords: | Foreign Direct Investment, Standards of Treatment, Bilateral Investment Treaties, Free Trade Agreements, Investor-State Disputes, Arbitration, Indonesia, ASEAN |
| JEL: | K33 F21 F53 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:era:wpaper:dp-2016-30&r=int |
| By: | McGrattan, Ellen R. (Federal Reserve Bank of Minneapolis); Waddle, Andrea L. (University of Richmond) |
| Abstract: | In this paper, we estimate the impact of increasing costs on foreign producers following a withdrawal of the United Kingdom from the European Union (popularly known as Brexit). Our predictions are based on simulations of a multicountry neoclassical growth model that includes multinational firms investing in research and development (R&D), brands, and organizational capital that are used nonrivalrously by their subsidiaries at home and abroad. For the main simulation, we assume that U.K. investments in the European Union face the same restrictions as Norway’s and that E.U. investments in the United Kingdom are treated reciprocally. We find a significant fall in foreign investment and production by U.K. firms, and a small but positive welfare gain for U.K. citizens. Following the Brexit, the United Kingdom increases international lending, which finances the production of others, both domestically and abroad. In the European Union, declines in investment and production are modest, but the welfare of non-U.K. citizens is lower. If, during the transition, the United Kingdom reduces current restrictions on other major foreign investors, such as the United States and Japan, domestic production and investment in the United Kingdom fall by less, and the welfare of U.K. citizens rises by more. |
| Keywords: | Brexit; Foreign investment; FDI; United Kingdom; European Union |
| JEL: | F23 F41 O33 O34 |
| Date: | 2017–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmsr:542&r=int |
| By: | Cilem Selin Hazir (Université Côte d'Azur; GREDEG CNRS; OFCE SciencesPo); Flora Bellone (Université Côte d'Azur; GREDEG CNRS; OFCE SciencesPo); Cyrielle Gaglio (Université Côte d'Azur; GREDEG-CNRS) |
| Abstract: | This paper explores the determinants of changes in the range of exports at the firm level with a particular interest in the role played by the locality via product relatedness. To this aim, we introduce a multi-regional setting to the theoretical framework proposed by Bernard et al. (2010), which explains multiple product firms and product switching. We test the propositions of the extended framework using French micro-data that covers information on mono-regional firms operating primarily in manufacturing industry over the period 2002-2007. Our main finding is that the local product space matters in the decisions firms make. Specifically, firms tend to modify their mix of exported products such that their production and export capabilities get more aligned with capabilities that lie beneath core capabilities of the region. Our results also suggest that once firms alter their range of exports, among all new products they start exporting, they enjoy greater export revenues in those that are more related to the core capabilities of the locality. |
| Keywords: | Local Product Space, Product Relatedness, Firm Export Churning, France |
| JEL: | L25 F14 C49 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:gre:wpaper:2017-02&r=int |
| By: | Moussir, Charaf-Eddine; Tabit, Safaa |
| Abstract: | This work aims to identify the relationship between Foreign Direct Investment (FDI) and export diversification in Morocco. The estimation results, driven by a Generalized Moment Methods (GMM) over the period 1980-2014, show that positive FDI and GFCF encourage export diversification while per capita income, real effective exchange rate, inflation and governance have negative impacts. Furthermore, despite Morocco’s efforts in order to initiate a structural transformation of its economy, it remains limited. |
| Keywords: | Export diversification, FDI, Herfindahl-Hirschman index, Structural transformation, Morocco, GMM. |
| JEL: | C32 F14 F21 L16 O55 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:76582&r=int |
| By: | Palokangas, Tapio K. (University of Helsinki) |
| Abstract: | I examine the effects of globalization in countries where the employed workers support the unemployed and the governments control wages by regulating the workers' relative bargaining power. I use a general oligopolistic equilibrium model of two integrated countries with two inputs: labor and potentially footloose capital. National competition for jobs by labor market deregulation creates a distortion with suboptimal wages. The mobility of capital aggravates that distortion by increasing the wage elasticity of labor demand, which decreases wages and welfare even further. The delegation of labor market regulation to an international agent eliminates that distortion, increasing wages and aggregate welfare. |
| Keywords: | international trade, footloose capital, labor market regulation, capital market liberalization |
| JEL: | C78 F16 F68 J52 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10468&r=int |
| By: | Rodrik, Dani |
| Abstract: | The bulk of global inequality is accounted for by income differences across countries rather than within countries. Expanding trade with China has aggravated inequality in some advanced economies, while ameliorating global inequality. But the 'China shock' is receding and other low-income countries are unlikely to replicate China's export-oriented industrialization experience. Relaxing restrictions on cross-border labor mobility might have an even stronger positive effect on global inequality. However it also raises a similar tension. While there would likely be adverse effects on low-skill workers in the advanced economies, international labor mobility has some advantages compared to further liberalizing international trade in goods. I argue that none of the contending perspectives -- national-egalitarian, cosmopolitan, utilitarian -- provides on its own an adequate frame for evaluating the consequences. |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11812&r=int |
| By: | Herz, Benedikt; Varela-Irimia, Xosé-Luís |
| Abstract: | This paper documents border effects in public procurement in the European Union Single Market. We use a data set of 2.3 million European public procurement contracts awarded between 2010 and 2014 to estimate a gravity model of bilateral procurement flows between European NUTS3 region pairs. Controlling for numerous variables, we find border effects on both the intra- and international level. Cross-national border effects are especially sizeable: firms located in the home region of the tendering authority are about 1300 times more likely to be awarded a contract than foreign firms. Our results hold for goods, services, and construction works procurement and cannot be explained by common currency, same language, and variables capturing cultural distance. |
| Keywords: | public procurement, public contract, border effect, home bias, cross-border, gravity model, European Union, Single Market |
| JEL: | F14 F15 H57 |
| Date: | 2016–11–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:76401&r=int |
| By: | Enrico De Angelis (IMT School for advanced studies); Rodolfo Metulini (Department of economics and management, University of Brescia); Vincenzo (Department of politics and international studies, Social science building, University of Warwik); Massimo Riccaboni (IMT School for advanced studies) |
| Abstract: | n light of growing water scarcity, virtual water, or the water embedded in key water-intensive commodities, has been an active area of debate among practitioners and academics alike. As of yet, however, there is no consensus on whether water scarcity affects conflict behavior and we still lack empirical research intending to account for the role of virtual water in affecting the odds of militarized disputes between states. Using quantitative methods and data on virtual water trade, we find that bilateral and multilateral trade openness reduce the probability of war between any given pair of country, which is consistent with the strategic role of this important commodity and the opportunity cost associated with the loss of trade gains. We also find that the substantive effect of virtual water trade is comparable to that of oil and gas, the archetypal natural resources, in determining interstate conflicts' probability. |
| Keywords: | Conflicts; International Trade; Water Scarcity; Virtual Water; Strategic Commodities |
| JEL: | F51 Q25 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:ial:wpaper:2/2017&r=int |
| By: | Lynda Sanderson (Ministry of Business, Innovation and Employment) |
| Abstract: | This note draws out data from the International Engagement module of the Business Operations Survey 2011. The module was designed to capture information on the international activities of a large, representative sample of New Zealand firms, including the types of activities they are involved in and the barriers they encounter. The note focuses on the level of interest that firms show in becoming internationally engaged, and how the barriers they perceive in entering and maintaining a place in international markets differ by their level of interest and experience. It also considers the extent to which interest in overseas income as reported in both the 2007 and the 2011 International Engagement modules translates to export market entry in later years, and how future entry propensity differs according to the barriers, motivations and strategies reported by the firm. |
| Keywords: | export barriers; firms; overseas income; international engagement |
| JEL: | D22 F10 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:nzt:nztwps:16/04&r=int |
| By: | Phumzile Ncube; Simon Roberts; Tatenda Zengeni; Paul C. Samboko |
| Abstract: | This paper considers findings of studies analysing the development of a regional animal feed to poultry value chain in southern Africa (Botswana, South Africa, Zambia, Zimbabwe). The southern African regional poultry value chain is underdeveloped, although important changes include investments by South Africa-based multinational firms and strong growth in Zambia. Building on this growth requires coherent trade and industrial policies supporting investments across countries and practical measures to reduce barriers to intra-regional trade and transport costs. The potential to develop a regional poultry value chain is substantial, considering that the South African deep-sea trade deficit in poultry is larger in size than the Zambian industry. |
| Keywords: | value chain, southern Africa, poultry, trade policies, industrial policies, case study |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2017-4&r=int |
| By: | Nathalia Rios Ballesteros; Thomas Goda |
| Abstract: | Natural resource-seeking foreign direct investment (FDI) rose substantially during the last two decades as global commodity prices soared. This type of FDI typically is expected to improve the current accounts of recipient countries. Notwithstanding the commodity boom, however, current account balances of many commodity-producing developing economies were negative during 1995–2013. Considering 31 commodity-producing countries, we find that the average net effect of a 1% increase in natural resource-seeking FDI was a 0.23% decline in the current account (measured as percentage of GDP). This surprising result can be explained by the repatriation of profits. |
| Keywords: | Foreign Direct Investment (FDI); net primary income (NPI); profit repatriation; current account; balance of payments; natural resources |
| JEL: | F21 O11 O24 |
| Date: | 2017–01–24 |
| URL: | http://d.repec.org/n?u=RePEc:col:000122:015298&r=int |
| By: | James, L.; Glynn, T. |
| Keywords: | beef imports, cost function, cost shares, ground beef, Demand and Price Analysis, Marketing, Production Economics, Q11, |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ags:saea17:252720&r=int |
| By: | Jean-Marc Siroën (LEDa - Laboratoire d'Economie de Dauphine - Université Paris-Dauphine) |
| Abstract: | The latest WTO Round launched in Doha in 2001 has once again stalled. Even if an agreement were reached it is not certain it would be ratified by the US Congress. The latest delay is due in part to the changing economic context in which the negotiations are taking place, some of which changes are due to decisions made during the course of the negotiations. Governments and public opinion are increasingly in favor of bilateral negotiations in which it is possible to include new subjects rejected in the Doha multilateral negotiations. These include rules on labor and environmental standards, compe-tition policy, investment, and government procurement. The assertiveness of emerging economies has upset the co-leadership positions of the US and the EU and argues for a new, as yet-to-be determined, negotiating process. The latest economic crisis has raised question about the objectives of the agriculture negotiations and has revealed the difficulties faced by an organization that thinks long-term of adapting to changes in the short term. This paper’s recommendations are aimed at improving the ability of the WTO to operate under current conditions and advocates the inclusion of new negotiating topics. If the principle of decision by consensus is not revised the rush to bilateralism is likely to continue, which is dangerous because of its discriminatory character. |
| Abstract: | Le nouveau cycle de négociations multilatérales (« Round ») ouvert à Doha en 2001 s’est enlisé et n’a pu aboutir à un accord final, dont la ratification par les Etats-Unis ne serait d’ailleurs pas acquise. Ce retard s’explique notamment par l’évolution du contexte, qui est parfois la conséquence des choix de Doha. L’adhésion des gouvernements et des opinions publiques s’est émoussée, avec une préférence de plus en plus affirmée pour des accords bilatéraux permettant, notamment, d’intégrer de nouveaux sujets bloqués à l’OMC (normes de travail, concurrence, investissement, marchés publics, environne-ment). L’affirmation des pays émergents a déséquilibré le co-leadership Etats-Unis-Union européenne et impliqué une modification du processus de négociation qui ne s’est pas stabilisé. La crise économique a remis en cause certains objectifs de la négociation agricole et révélé la difficulté d’une organisation qui raisonne dans le long terme à adapter sa doctrine aux conditions de court terme. Les quelques pro-positions formulées visent à réviser la doctrine pour mieux l’insérer dans une problématique moderne ; elles défendent l’inclusion de nouveaux sujets qui élargissent le champ des négociations. Si le principe du consensus n’est pas remis en cause, la réhabilitation des accords plurilatéraux pourrait désamorcer une orientation vers le bilatéralisme, dangereuse à terme par son caractère discriminatoire |
| Keywords: | Doha,OMC,négociations commerciales |
| Date: | 2016–12–14 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01399859&r=int |
| By: | Marianne Matthee; Neil Rankin; Carli Bezuidenhout |
| Abstract: | This paper contributes to the understanding of the linkages between exporting, labour demand, and wages in South Africa. We disentangle labour market differences between exporters and non-exporters and find that exporters employ more people and pay higher wages. Given these higher wages we investigate how this wage premium is distributed within the exporting firm. There appears to be a wide dispersion of wages within exporters (particularly international/non-African exporters). However, almost all of that dispersion (particularly amongst continuing exporters) is explained by the labour productivity and size of these firms. This suggests that there is thus a large degree of dispersion for these variables for these firm groups (relative to non-exporters). Wage inequality within exporters is not driven by exporting but rather by characteristics associated with the types of firms which participate in the export market. |
| Keywords: | exporters, firm-level data, labour demand, wages, inequality, South Africa |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2017-11&r=int |
| By: | Campante, Filipe R. (Harvard University); Yanagizawa-Drott, David (University of Zurich) |
| Abstract: | We study the impact of international long-distance flights on the global spatial allocation of economic activity. To identify causal effects, we exploit variation due to regulatory and technological constraints which give rise to a discontinuity in connectedness between cities at a distance of 6000 miles. We show that these air links have a positive effect on local economic activity, as captured by satellite-measured night lights. To shed light on how air links shape economic outcomes, we first present evidence of positive externalities in the global network of air links: connections induce further connections. We then find that air links increase business links, showing that the movement of people fosters the movement of capital. In particular, this is driven mostly by capital flowing from high-income to middle-income (but not low-income) countries. Taken together, our results suggest that increasing interconnectedness generates economic activity at the local level by inducing links between businesses, but also gives rise to increased spatial inequality locally, and potentially globally. |
| JEL: | F15 F21 F23 F63 O11 O18 O19 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:16-034&r=int |
| By: | K, S Chalapati Rao; Dhar, Biswajit |
| Abstract: | “The Tenuous Relationship between Make in India and FDI Inflows”, analyses the empirical issues in measuring the FDI inflows and highlights the problems in attributing FDI inflows to specific policy measures. In view of major inaccuracies in the reported data, reporting delays and mis-classification, it finds that the surge in FDI inflows in the recent past cannot be really attributed to the ‘Make in India’ initiatives. |
| Keywords: | FDI, India, DIPP,FDI Policy, Make in India, Measurement of FDI |
| JEL: | F3 F4 O2 |
| Date: | 2016–12–24 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:76468&r=int |
| By: | Lopez, Claude; Adams-Kane, Jonathon; Wilhelmus, Jakob |
| Abstract: | International capital flows and cross-border financial integration remain omnipresent in the European political debate as countries struggle with low and divergent GDP growth, new European financial regulation and the anticipation of Brexit. In such a shifting environment, this report first identifies some of the more recent patterns in the landscape of European gross cross-border investment followed by a closer look at banking and portfolio investments. |
| Keywords: | capital flows, cross-border investment,, portfolio investment, FDI |
| JEL: | F3 F4 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:76622&r=int |
| By: | Uuriintuya Batsaikhan; Robert Kalcik; Dirk Schoenmaker |
| Abstract: | London is an international financial centre, serving European and global clients. A hard Brexit would lead to a partial migration of financial firms from London to the EU27 (EU minus UK) to ensure they can continue to serve their EU27 clients. Four major cities will host most of the new EU27 wholesale markets - Frankfurt, Paris, Dublin and Amsterdam. These cities have far fewer people employed in finance than London. Moreover, they host the European headquarters of fewer large companies. The partial migration of financial firms will thus have a major impact on these cities and their infrastructures. Banks are the key players in wholesale markets. United States and Swiss investment banks, together with one large German and three large French banks, will make up the core of the new EU27 wholesale markets. Some Dutch, Italian and Spanish banks are in the second tier. The forex, securities and derivatives trading markets are now in London. We map the current, limited market share of the four major cities that might host the EU27 client business. The expected migration of financial trading will lead to a large increase in trading capacity (eg bank trading floors). Clearing is the backbone of modern financial markets. A comparative overview of clearing facilities in the EU27 shows that Germany and France have some clearing capacity, but this will need to be expanded. The ownership of clearing is often intertwined with stock exchanges. Were the planned LSE-Deutsche Börse merger to go ahead, LSE would sell the Paris subsidiary of its clearinghouse. In terms of legal systems, there is an expectation that trading activities will be able to continue under English contract law, also in the EU27. A particular challenge is to develop FinTech (financial technology) in the EU27, as this innovative part of the market is currently based in London. We estimate that some 30,000 jobs might move from London to the EU27. This will put pressure on the facilities (infrastructure, offices, residential housing) in the recipient cities. The more the European Union market for financial services is integrated, the less need there will be for financial firms to move to one location, reducing the pressure for all facilities to be in one city (see Sapir et al, 2017, which is a companion piece to this paper). |
| Date: | 2017–02 |
| URL: | http://d.repec.org/n?u=RePEc:bre:polcon:18984&r=int |