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on International Trade |
| By: | Suh , Jin Kyo (Korea Institute for International Economic Policy); Lee , Hyo-young (Korea Institute for International Economic Policy); Park , Ji Hyun (Korea Institute for International Economic Policy); Lee , Joun Won (Korea Institute for International Economic Policy); Kim , Do Hee (Korea Institute for International Economic Policy) |
| Abstract: | Korean Abstract: 세계적으로 반무역자유화 정서가 확산되는 가운데 국제무역이 구조적으로 감소하고 있고 선진국을 중심으로 하는 복수국간협상이 확산되고 있다. 또한 파리기후변화협약의 이행으로 무역과 환경이 조화를 이루어야 하는 시대가 도래하였다. 본 보고서는 이러한 글로벌 통상환경에서 나타난 주요한 변화를 고려하여 나이로비 각료회의 이후 우리나라가 취해야 할 다자통상정책의 방향을 단기 DDA 협상대책과 중장기 정책방향으로 나누어 제시하였다. English Abstract: The WTO's Tenth Ministerial Conference, held in Nairobi on December 2015, concluded with the adoption of the "Nairobi Package", several ministerial decisions on agriculture, cotton and least-developed countries. The Nairobi Package includes a historic decision to eliminate agricultural export subsidies, the most important reform of international trade rules in agriculture since the WTO was founded. The biggest disagreement among WTO members, however, goes beyond specific substantive issues: it is about the future of the Doha agenda and the WTO's negotiating function itself. While developing countries wished to continue with negotiations, industrialized nations, chief among them the United States, called for an end to the Doha Round. The Nairobi Ministerial Declaration also acknowledges that WTO members "have different views" on the future of the Doha Round negotiations but notes the "strong commitment of all members to advance negotiations on the remaining Doha issues". In this situation, there have been significant changes in international trade since recent decades. First, trade growth has been anaemic since 2010. Already before the 2008 Global Crisis hit, the rate of growth of the ratio of global trade to GDP had slowed considerably. Most recent data show trade values declining. Second, plurilateral negotiations are rapidly widespread in the WTO. In particular, developed members have pushed for more sectoral deals like the ITA-II. Currently, a similar deal on tariff reductions for environmental goods is being negotiated. More sectoral tariff liberalization of this sort might be a good area to pursue. Along the same lines, the trade in services talks going on in Geneva could be brought formally into the WTO framework. Third, at the Paris climate conference (COP21) in December 2015, 195 countries adopted the first-ever universal, legally binding global climate deal, which is expected to affect a significant impact on global trade. At the heart of the Paris climate agreement are national-level plans, called Intended Nationally Determined Contributions (INDCs), to reduce greenhouse gas (GHG) emissions. Although these INDCs are voluntary, they are considered a critical first step for an agreement designed to progressively ratchet up national commitments to collectively limit a global temperature rise to 1.5 degrees Celsius above pre-industrial age levels. It is now time that we have to design a harmonization between trade and environments. |
| Date: | 2016–12–30 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kieppa:2016_004&r=int |
| By: | Nam , Sang-Yirl (Korea Information Society Development Institute (KISDI)) |
| Abstract: | As tariff barriers, of traditional and typical policy instruments in international trade, have been reduced significantly under preferential trade agreements as well as the multilateral trading system, non-tariff measures (NTMs), especially those of technical barriers to trade (TBT), become more and more important as means to control international trade. This study is to analyze and better understand TBT or more accurately, technical measures. Based on the analysis, it will attempt to identify some implications and ways to reduce TBT or to facilitate international trade, and ultimately contribute to enhancing economic integration in the Asia-Pacific region. The characteristics and trends of technical measures can be best identified and evaluated by the notifications of WTO members according to the Agreement on Technical Barriers to Trade (TBT Agreement), discussions in the WTO TBT Committee - especially specific trade concerns (STCs), and dispute settlement cases in TBT related issues. In fact, the number of TBT notifications have surged as various and comprehensive legitimate objectives of technical regulations were allowed and on other backgrounds since the launch of the WTO in 1995. It is noted, however, that TBT notifications are not regarded as TBT itself but as "potential" TBTs in this study. To analyze the trends and characteristics of TBT measures, this study utilizes the information in the WTO TBT notifications, STCs, and dispute settlement cases related to the TBT Agreement. Focus will be on the APEC member economies. Some trends and characteristics of TBT measures by the objective of regulation, by commodity, and by the country notified (e.g., developed and developing economies) will be analyzed and identified. Some of implications from the results are as follows. Due to the fact that technical measures are mostly domestic regulations but controlled at the border to restrict market access, there needs to be consultation, cooperation and harmonization of regulation rather than competition and retaliation. There also needs to be developed a system for information and experience exchange, capacity building including on development and implementation of standards, technical regulation, and conformity assessment procedures, especially for developing economies. APEC is well positioned to lead international cooperation in TBT with its diverse members and related specific institutions. |
| Keywords: | Technical Barriers to Trade; TBT; NTMs; APEC; Asia-Pacific Region |
| JEL: | F13 F53 F55 O19 |
| Date: | 2015–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kiepas:2015_001&r=int |
| By: | Thomas Chaney (Département d'économie) |
| Abstract: | I propose a model of international trade with liquidity constraints. If firms must pay a fixed entry cost in order to access foreign markets, and if they face liquidity constraints to finance these costs, only those firms that have sufficient liquidity are able to export. A set of firms could profitably export, but are prevented from doing so because they lack sufficient liquidity. More productive firms that generate large liquidity from their domestic sales, and wealthier firms that inherit a large amount of liquidity, are more likely to export. This model offers a potential explanation for the apparent lack of sensitivity of exports to exchange rate fluctuations. When the exchange rate appreciates, existing exporters lose competitiveness abroad, and are forced to reduce their exports. At the same time, the value of domestic assets owned by potential exporters increases. Some liquidity constrained exporters start exporting. This dampens the anti-competitiveness impact of a currency appreciation. Under some conditions, it may reverse it altogether and increase aggregate exports. In this sense, the model is able to rationalize the co-existence of competitive devaluations and competitive revaluations. |
| Keywords: | International trade; Liquidity constraint; Heterogeneous firms |
| JEL: | F1 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/5g3sadr9h8gbri8hrtq0h6au2&r=int |
| By: | Ali, Ashfaque |
| Abstract: | This paper investigates the possible impacts of Pakistan-Turkey free trade agreement (Pak-Turk FTA) on various sectors of the economy in the two countries under four different possible FTA scenarios by using computable general equilibrium model GTAP. Global Trade Analysis Project (GTAP) model has been extensively used in FTAs and other Trade related studies to evaluate the economy-wide potential impact of economic policy reforms. Current study uses the GTAP database7 which includes; 57 tradable commodities and 113 regions across the world. Our findings suggest that; Turkey is more beneficial from Free Trade Agreement as compared to Pakistan .Overall impact of trade liberalization is favorable for both economies, but liberalization of protected sectors may prove to be unfavorable for the economy in case of Pakistan. And there is a huge potential for bilateral trade in textile and chemical sector. |
| Keywords: | Computable General Equilibrium (CGE) Analysis, Free Trade Agreement (FTA), Pakistan, and Turkey. |
| JEL: | F10 F14 F17 |
| Date: | 2017–04–14 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:78318&r=int |
| By: | Chrysovalantou Milliou (Department of International and European Economic Studies); Joel Sandonís Díez (Universidad de Alicante) |
| Abstract: | According to conventional wisdom, multinational firms undertake vertical FDI in order to take advantage of cross-border factor cost differences and source the inputs from abroad at better terms. Recent empirical findings though document that this is not always the case. We provide theoretical support to the latter by demonstrating that when there is transfer of intangible assets between a multinational’s vertically related production plants, its parent firm can engage in vertical FDI in order to improve its cross-threat and its input sourcing terms domestically and not abroad as well as in order to exploit its intangible assets in another country. We also investigate the effects of trade liberalization and the welfare consequences of vertical FDI. |
| Keywords: | international trade; vertical FDI; inputs; trade liberalization; intangible assets; two-part tariffs |
| JEL: | L13 L22 L23 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:ivi:wpasad:2017-02&r=int |
| By: | Ramesh Chandra Paudel; Swarnim Wagle |
| Abstract: | This paper assesses export performance and potentials for increased bilateral trade with regional partners of Nepal, a least-developed country (LDC) in South Asia. Following an overview of the country’s export performance, and the distinct policy and logistical challenges it faces as a landlocked country, an econometric analysis of the determinants of bilateral exports is undertaken using the gravity modelling framework. The results suggest that the ‘structural’ factors such supply-side constraints, distance to markets, and cultural proximity as geographical and cultural proximity have mattered more than trade and other policy barriers imposed by destination markets. The paper also identifies partners to which Nepal appears to be "under-exporting," and concludes that there is much room for the country to integrate further with regional markets if it were to overcome its supply side constraints. |
| Keywords: | Nepal, export performance, gravity model, landlocked countries, regional integration |
| JEL: | F13 F11 F12 O50 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:pas:papers:2017-06&r=int |
| By: | TOMIURA Eiichi; ITO Banri; MATSUURA Toshiyuki; WAKASUGI Ryuhei |
| Abstract: | Multinationals often have subsidiaries in multiple countries and are likely to be involved in complex operations such as trade between subsidiaries. Collecting accurate data on intra-firm trade is required for deepening our understanding of global business activities. This paper documents intra-firm trade based on a survey of Japanese multinational firms in the manufacturing and wholesale/retail industries. The notable results from our survey are as follows. A non-negligible fraction of offshore subsidiaries trade goods with their parent firms as well as with other subsidiaries located in different countries but which are owned by the same parent multinationals. Trade in services is far less common than that in goods. More than 20% of offshore subsidiaries import technologies from their parents. Although these findings are generally consistent with stylized facts, several puzzles remain for further investigation. |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:17028&r=int |
| By: | Sung , Hankyoung (University of Seoul) |
| Abstract: | This paper uses the most recent Global Trade Analysis Project (GTAP) DB version 9 and a recursive dynamic computable general equilibrium model (CGE) to analyze the economic effect of enhancement in labor productivity that trade liberalization has in the APEC. In particular, unlike the previous studies that apply tariff reduction, this paper focuses on the changes in labor productivity reported by Ahn et al. (2016). The results show an increase in the real GDP of countries with gains in labor productivity. In particular, the results of this study indicate that the benefits of trade liberalization would be even larger for developed countries with a similar level of gains in labor productivity. It is also suggested that the efficiency of production structure or scale of economy may work for developed economies. In conclusion, this paper suggests another reason to pursue trade liberalization within in the APEC region. |
| Keywords: | Labor Productivity; Dynamic CGE Model; Trade Liberalization; Real GDP |
| Date: | 2016–11–30 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kiepas:2016_002&r=int |
| By: | Huang, Xiaobing |
| Abstract: | This paper highlights the relationship between foreign exchange rate fluctuations and firms' export market dynamics using a Chinese firm-level production data and a firm-level trade data over the period of 2000-2006. The author adopts a discrete-time survival model in his empirical investigation and further executes several extensions and robustness checks to the baseline results. The main results of the paper can be summarized as follows: First, an exchange rate appreciation increases the likelihood of export market exit, reduces the capability of export market survival and decreases the probability of export market entry. Second, high productivity firms are less likely to exit from export markets and more likely to enter and survive in export markets in the period of exchange rate appreciation. Third, exchange rate appreciation decreases the likelihood of export market entering and increases the likelihood of export market exiting more for private-owned firms, young firms and non-eastern firms. Finally, other sources of heterogeneity, such as extensive margins, import demand elasticity, different destinations, U.S. dollar peg, and the liberalization of trading rights also matter regarding the effect of exchange rate changes. |
| Keywords: | exchange rate movements,export market dynamics,firm heterogeneity,China |
| JEL: | F14 F31 F32 F41 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:201713&r=int |
| By: | Hyunbae CHUN; Jung HUR; Young Gak KIM; Hyeog Ug KWON |
| Abstract: | This paper gives two findings about the cross-border vertical integration and intra-firm trade of firms in Korean and Japanese manufacturing industries. First, the intra-firm trade between a parent firm and its affiliates is highly concentrated in a small number of large multinational corporations. Second, the input-output coefficient between the parent firm's industry and the affiliate's industry is weakly related to the presence and magnitude of intra-firm trade between the parent firm and its affiliates. Furthermore, these two findings are also found in domestic vertically integrated firms. In particular, the second fact casts doubt on the traditional view of the cost-saving motive of vertical multinational firms and indicates the need for further investigation on a new motive for cross-border vertical integration. |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:17049&r=int |
| By: | bertrand blancheton; becuwe stephane; meissner chrispother |
| Abstract: | How did an advanced industrial country react face a great liberalization? How did this country adapt itself to global markets in the face of rapidly rising foreign productivity and falling trade costs. How an early starter adapt it insertion strategy in international trade in long run perspective? By using a new database on French International Trade we analyse exports concentration, specialization and quality. Face trade liberalization an old country, early starter reacts by increasing product quality |
| Keywords: | France, Trade issues, Trade issues |
| Date: | 2016–07–04 |
| URL: | http://d.repec.org/n?u=RePEc:ekd:009007:9248&r=int |
| By: | Lee , Sooyoung (Korea Institute for International Economic Policy) |
| Abstract: | Since late last year, Korean exports seem to be recovering from the long tunnel of negative growth that continued for 20 consecutive months. It might be, however, too early to predict whether Korean exports will sustain the growth in the future. The long-run trend of Korean exports has been unusually eventful in the last decade and both cyclical and structural components lie behind it. The trade drop in 2015 has strong cyclical aspects. The exceptionally low oil prices drove down export prices and total exports while the quantity of exports kept growing. But, there is evidence that the overall slowdown of Korean exports has structural aspects: (1) the so-called 'China factor' is found in the analysis of trade-income elasticity of the world and China for imports from Korea. (2) The number of protectionism measures has surged since 2012. (3) The bilateral trade barriers between Korea and its important trading partners are universally tightening. Trade slowdown brings up concerns because Korea's revealed comparative advantages of most manufacturing industries are falling as well. It is advisable to diversify main export products to lower the effect of oil prices on export prices and to strengthen the cooperation with ASEAN countries, whose trade barriers have exceptionally diminished throughout the last decade. |
| Keywords: | Trade Slowdown; Exports; Korea; Structural; Cyclical |
| Date: | 2017–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kiepwe:2017_009&r=int |
| By: | Auboin, Marc; Borino, Floriana |
| Abstract: | Since the recovery from the great financial crisis in 2010, global real trade flows grew much slower than pre-crisis, in both absolute terms (growth rates) and relative terms (relative to GDP, from 2:1 in the great 1990's to 1:1 since 2012) A debate has arisen as to whether this global trade slowdown, and related falling trade-to-income elasticity, was structural or cyclical. Some papers emphasized the slowing pace of international vertical specialization. Other works emphasized the prominent role of aggregate demand, notably when weighted by its trade component. Our paper goes in this latter direction. We estimated the standard import equation for 38 advanced and developing countries over the period 1995-2015, using an import intensity-adjusted measure of aggregate demand (IAD), calculated from input-output tables at country level, and compared results with regressions using GDP. The integration of IAD allows us to predict 76% to 86% of the changes in global imports, a better performance than if using GDP. The use of IAD also enabled us to measure the relative importance of each component of demand, according to their trade intensity. The model is able to account for over 90% of the recent trade slowdown (2012-2015), with IAD alone explaining 80% of it. The slowdown in global value chains explains more than half of the remaining share of the global trade slowdown, not explained by demand factors. Protectionism does not come up as statistically significant. |
| Keywords: | investment,global outlook, trade policy,trade forecasting,business cycles |
| JEL: | E22 F01 F13 F17 F44 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wtowps:ersd201709&r=int |
| By: | Choi , Byung-il (Ewha Womans University - Graduate School of International Studies (GSIS)) |
| Abstract: | While the pathway to the Free Trade Area of the Asia-Pacific (FTAAP) has been intensely discussed with a focus on its architecture, something has been missing: how to link trade and investment liberalization with inclusive growth of the APEC economies. The APEC economies have been increasingly open to trade and investment, but domestic distortions persist. The consequences have been less beneficial effects of trade and investment liberalization to domestic stakeholders. In particular, less-advantageous minorities have become more vulnerable to external economic shocks. If these failures are not urgently and seriously addressed, political support for further integration towards the FTAAP will continue to weaken. This reckoning has led to this paper. This paper offers policy options to make the FTAAP more conducive to inclusive growth of the APEC economies. Policy proposals are offered in two fronts. At negotiations, a grand compromise between advanced and developing economies should be sought to make negotiations agenda more comprehensive and balanced. Under this grand bargain, protected sectors in advanced economies -- potential exporting sectors for developing economies -- would be opened in exchange for more commitment in new rules by developing economies. To make this grand bargain politically possible, each side should do its homework domestically. Empowering human capital and skill upgrading programs will be urgent and imperative, along with designing more effective trade adjustment assistance programs. To enhance the possibility of achieving this comprehensive and balanced agenda, and to ensure all are on board, a two-track commitment should be designed. At the domestic front, major distortions which have obstructed a more inclusive integration in the past should be urgently corrected. Specifically, policy preference for incumbents should be removed; labor markets should become less rigid; capital markets should be accessible to all; and social safety nets should be strengthened. |
| Keywords: | Regional Integration; Inclusive Growth; APEC; FTAAP; TPP; RCEP |
| JEL: | F13 F51 F68 |
| Date: | 2016–11–30 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kiepas:2016_001&r=int |
| By: | Tena Junguito, Antonio; Absell, Christopher David |
| Abstract: | To date, research on the economic history of Brazil during the nineteenth century has relied on official foreign trade statistics, the accuracy of which has repeatedly been put into question. This paper provides insights into the accuracy of the official series by examining the accuracy of the export and import series for Brazil during the nineteenth century. We re-estimate the official import series using trading partner sources, and find that the official series was marginally under-valued during certain periods of the nineteenth century. Furthermore, we provide new upper- and lower-bound estimates of the export series by testing different assumptions regarding the size of the cif-fob factor adjustments. Finally, we introduce a new import price index for the period 1827-1913. |
| Keywords: | Price Indices; Foreign trade reconstruction; Brazil; Nineteenth Century globalization |
| JEL: | N76 F14 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:cte:whrepe:24511&r=int |
| By: | Jean-Marc Siroën (LEDa - Laboratoire d'Economie de Dauphine - Université Paris-Dauphine); David Andrade (LEDa - Laboratoire d'Economie de Dauphine - Université Paris-Dauphine) |
| Abstract: | Over the last two decades, a growing number of free trade agreements have included social and labour provisions. This Policy Brief investigates the repercussions of such clauses on the ratification of what are seen as fundamental ILO conventions and on workers‟ rights practices. An empirical estimation indicates that labour provisions have not played a significant role in improving labour practices, and that their effect has been limited to the ratification of ILO conventions. This gap highlights the importance included in trade agreements. |
| Keywords: | Regional trade agreements,Social clauses,clauses sociales,Accords commerciaux régionaux |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01429028&r=int |
| By: | Tarun Kabiraj |
| Abstract: | In a duopolistic trade model we have shown that a tariff can influence the optimal licensing strategy of the foreign firm. A high tariff will induce fee licensing and a low tariff will result in a royalty licensing. From the viewpoint of the consumers both high tariff and high royalty are distortaionary; hence there is a trade-off between a tariff and a royalty. Then the local government can suitably choose a tariff rate that will induce fee licensing, then consumers' welfare is maximized. In the paper we have used the tools and techniques of game theory and industrial organization literature to the issue of technology licensing and consumers' welfare. We have shown that a tariff on foreign products can be strategically chosen so that the foreign firm transfers its superior technology to a domestic firm under a fee licensing contract and consumers' welfare is maximized. |
| Keywords: | It is a theoretical work, so applicable to any country, Trade issues, Game theoretical models |
| Date: | 2016–07–04 |
| URL: | http://d.repec.org/n?u=RePEc:ekd:009007:9149&r=int |
| By: | Rodolphe Desbordes; Shang-Jin Wei |
| Abstract: | This paper empirically investigates the various effects that source and destination countries’ financial development (SFD and DFD respectively) have on foreign direct investment (FDI).We establish causality by exploiting variations in both country-specific financial development and sector-specific financial vulnerability. This approach is made possible by our use of detailed databases on real manufacturing FDI projects worldwide. We find that both SFD and DFD have a large positive influence on greenfield, expansion, and mergers & acquisitions FDI, by directly increasing access to external finance and indirectly promoting manufacturing activity. The overall economic impacts of SFD and DFD tend to be similar but their direct and indirect effects vary across margins and types of FDI. |
| JEL: | F21 O1 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23309&r=int |
| By: | Rodrik, Dani (University of Chicago) |
| 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--rovides on its own an adequate frame for evaluating the consequences. |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp17-003&r=int |
| By: | Clemens, Michael (Center for Global Development, Washington, DC); Pritchett, Lant (Harvard University and Center for Global Development, Washington, DC) |
| Abstract: | For decades, migration economics has stressed the effects of migration restrictions on income distribution in the host country. Recently the literature has taken a new direction by estimating the costs of migration restrictions to global economic efficiency. In contrast, a new strand of research posits that migration restrictions could be not only desirably redistributive, but in fact globally efficient. This is the new economic case for migration restrictions. The case rests on the possibility that without tight restrictions on migration, migrants from poor countries could transmit low productivity ("A" or Total Factor Productivity) to rich countries--offsetting efficiency gains from the spatial reallocation of labor from low to high-productivity places. We provide a novel assessment, proposing a simple model of dynamically efficient migration under productivity transmission and calibrating it with new macro and micro data. In this model, the case for efficiency-enhancing migration barriers rests on three parameters: transmission, the degree to which origin-country total factor productivity is embodied in migrants; assimilation, the degree to which migrants' productivity determinants become like natives' over time in the host country; and congestion, the degree to which transmission and assimilation change at higher migrant stocks. On current evidence about the magnitudes of these parameters, dynamically efficient policy would not imply open borders but would imply relaxations on current restrictions. That is, the new efficiency case for some migration restrictions is empirically a case against the stringency of current restrictions. |
| JEL: | F22 J61 O11 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp16-054&r=int |
| By: | Roberts, Michael; Mohammed, Nazia |
| Abstract: | The frequency, severity and economic impact of natural disasters are growing. Import surges resulting from disaster-response efforts can highlight underlying structural failings in the border clearance regimes of disaster-affected countries. Relief supplies, specialized personnel and agencies often face regulatory barriers affecting their entry and practice in disaster-affected environments. Against that background, the purpose of this working paper is twofold: it sets out to explore trade issues that can undermine effective disaster response, and then outlines how these trade issues might be addressed, including through implementation of the WTO Trade Facilitation Agreement as well as through technology-enabled services and the expansion of disaster risk insurance. The merits of further discussion of trade and natural disasters are also discussed. |
| Keywords: | trade policy,disaster-response,WTO trade facilitation agreement |
| JEL: | F13 J60 K33 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wtowps:ersd201707&r=int |
| By: | Bruno, Randolph; Campos, Nauro F; Estrin, Saul |
| Abstract: | There is wide consensus about the economic benefits from foreign direct investment. Yet these benefits are often viewed as being conditional, that is, as dependent on recipient countries having reached minimum levels of institutional, financial or human capital development or, at the micro level, on the type of inter-firm linkages (forwards, backwards, or horizontal). We conduct a meta-analysis to summarize and explain the strength and heterogeneity of these conditionalities. We use hand-collected information from 175 studies and around 1100 estimates in Eastern Europe, Asia, Latin America and Africa from 1940 to 2008. We propose a new methodological framework that allows country- and firm-level effects to be combined. There are two principal findings: (a) the difference between "macro" and "firm" effects is positive and significant (with the former at least six times larger than the latter); and (b) the benefits from FDI are substantially less"conditional" than commonly thought. |
| Keywords: | aggregate productivity.; enterprise performance; firm-to-firm effects; Foreign direct investment; meta-regression-analysis; overall effects |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11959&r=int |
| By: | Wu, Xiaoping |
| Abstract: | The interplay between patents and standards in the information and communication technology (ICT) sector has been intensively debated at international, regional and national levels over the past decades. In essence, the debate is firstly about the extent and impact of patent holdup and holdout in the ICT sector, and then about how to eliminate or reduce these practices. While standard setting organizations (SSOs), industry bodies, as well as judicial and administrative authorities have made great efforts to solve the issue of patent holdup and holdout, there is still an ongoing struggle among divergent stakeholders. Patent holdup and holdout directly impacts the innovation and dissemination of patented technology, the harmonization and implementation of standards, and international trade, which are promoted by the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) and the Agreement on Technical Barriers to Trade (TBT Agreement). This working paper provides an overview of the current debate on patent holdup and holdout in the ICT sector, analyses existing policy measures and their limitations, and then highlights the relevance of the WTO to this debate. |
| Keywords: | patent,patent holdup,patent holdout,standards,standard setting organizations,FRAND,competition,injunctions,royalties,WTO TRIPS,WTO TBT |
| JEL: | K11 K13 K30 O34 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wtowps:ersd201708&r=int |
| By: | NAITO Takumi |
| Abstract: | We develop a new optimal tariff theory which is consistent with the fact that a larger country sets a lower tariff. In our dynamic Dornbusch-Fischer-Samuelson Ricardian model, the long-run welfare effects of a rise in a country's tariff consist of the revenue, distortionary, and growth effects. Based on this welfare decomposition, we obtain two main results. First, the optimal tariff of a country is positive. Second, a country's marginal net benefit of deviating from free trade is usually decreasing in its absolute advantage parameter, implying that a larger (i.e., more technologically advanced) country sets a lower optimal tariff. |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:17037&r=int |
| By: | Voxi Amavilah (REEPS, Arizona, USA); Simplice Asongu (Yaoundé/Cameroun); Antonio Andrés (Barranquilla, Colombia) |
| Abstract: | We argue that there exists an indirect link between globalization and the knowledge economy of African countries in which globalization influences ‘peace and stability’ and peace and stability affects governance, and through governance the knowledge economy. We model the link as a three-stage process in four testable hypotheses, which permits an empirical analysis without sacrificing economic relevance for statistical significance. The results indicate that the impacts on governance of peace and stability from globalization defined as trade are stronger than those of peace and stability resulting from globalization taken to be foreign direct investment. We conclude that foreign direct investment is not a powerful mechanism for stimulating and sustaining the African knowledge. However, since the effects of globalization on peace and stability can influence governance both positively and negatively, we also conclude that the prospect for the knowledge economy in African countries may be realistic and attainable, as long as these countries continue to engage in the kind of globalization that enhances peace and stability. |
| Keywords: | Globalization; peace and stability; Governance; knowledge economy, African countries |
| JEL: | I20 I28 K42 O10 O55 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:agd:wpaper:17/014&r=int |
| By: | Toshihide Yorozu (Bank of Japan); Ayana Shibasaki (Bank of Japan); Mitsuhiro Osada (Bank of Japan); Masato Higashi (Bank of Japan) |
| Abstract: | Real exports and imports compiled and released by the Research and Statistics Department of the Bank of Japan, based on concepts consistent with exports and imports in real GDP, serve as an indicator for measuring the real value of export/import goods, that is adjusted for the effects of price changes. In this latest release, we have made revisions including changes to goods and region classifications so as to reflect structural changes in exports among other factors. We also include an update of the base year of the deflators used for calculating real exports and imports in line with the base year revision of the Corporate Goods Price Index. This paper explains these revisions together with the methodologies used to compile the real export/import data. It also provides some useful tips when using the real export/import data in practice. |
| Keywords: | real exports: real imports; goods trade; GDP |
| JEL: | F10 F14 O11 |
| Date: | 2017–04–20 |
| URL: | http://d.repec.org/n?u=RePEc:boj:bojron:ron170420a&r=int |
| By: | Busch, Berthold; Matthes, Jürgen |
| Abstract: | A plethora of analyses attempts to quantify the economic impact of a Brexit for the United Kingdom (UK). The results are rather confusing - ranging from significant advantages to marked losses. This can be explained by significantly different methods, diverse assumptions, and the different aspects which are included - as this comprehensive meta-analysis shows with a comparative analysis. We cut through the fog of assertions and seek to get to the reality of the situation facing the UK after a Brexit. The more reliable amongst the many studies surveyed estimates that the net economic cost will remain moderate (between 1 to mostly less than 5 percent of economic output or income). However, we challenge this mainstream view. The risks of a Brexit are likely to be underestimated and the economic damage to the UK could be significantly higher than the mainstream view suggests. The authors suggest that pertinent forward-looking theoretical models are unable to capture the many important advantages of economic integration between the UK and the EU. They provide a thorough overview of the various advantages that are left out and point out their relevance for welfare and growth. Currently, there is no universally accepted method of estimation available to integrate all of these specific effects in a comprehensive way. The available backward-looking empirical studies that attempt to do this can be criticised to some extent. But they indicate significantly greater risks for the UK. Overall, net economic damage around 10 percent of economic output or more cannot be ruled out in a more pessimistic scenario in the longer run. |
| JEL: | F14 F15 F21 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwkrep:102016&r=int |
| By: | Fatih Guvenen; Raymond J. Mataloni, Jr.; Dylan G. Rassier; Kim J. Ruhl |
| Abstract: | Official statistics display a significant slowdown in U.S. aggregate productivity growth that begins in 2004. In this paper, we investigate a source of mismeasurement in official statistics, which arises from offshore profit shifting by multinational enterprises operating in the United States. This profit shifting causes part of the economic activity generated by these multinationals to be attributed to their foreign affiliates, leading to an understatement of measured U.S. gross domestic product. Profit-shifting activity has increased significantly since the mid-1990s, resulting in an understatement of measured U.S. aggregate productivity growth. We construct adjustments to correct for the effects of profit shifting on measured gross domestic product. The adjustments raise aggregate productivity growth rates by 0.1 percent annually for 1994–2004, 0.25 percent annually for 2004–2008, and leave productivity unchanged after 2008; Our adjustments mitigate, but do not overturn, the productivity slowdown in the official statistics. The adjustments are especially large in R&D-intensive industries, which are most likely to produce intangible assets that are easy to move across borders. The adjustments boost value added in these industries by as much as 8.0 percent annually in the mid-2000s. |
| JEL: | E01 E24 F23 O4 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23324&r=int |
| By: | Hayat*+, Arshad; Cahlik*✝, Tomas |
| Abstract: | In this paper, we use a threshold regression model to estimate a threshold level of natural resource abundance and split the sample of 70 countries into groups of low-natural resource and high-natural resource groups. We found evidence that FDI has a positive impact on economic growth of the host country if the host country’s natural resource sector is below the threshold. However, FDI inflow doesn’t have any significant impact on growth in countries with natural resource sector larger than the threshold. In the end, we apply a Markov regime switching model (MSM) to a time series data from Pakistan and found that Pakistan’s economy experienced 2 states. While in the state 1 the economy didn’t experience any FDI induced economic growth, it did receive a strong FDI induced economic growth in state 2. |
| Keywords: | FDI, Economic Growth, Natural Resources, Threshold Model, Markov Switching Model |
| JEL: | O47 P28 P45 |
| Date: | 2017–04–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:78240&r=int |
| By: | Mauricio Lascurain Fernández; Luis Fernando Villafuerte Valdés |
| Abstract: | En este artículo se da a conocer la dinámica de la economía mexicana durante la segunda mitad del siglo XIX, periodo que se le conoce como la “primera globalización”. En este periodo, el país avanzó económicamente, lo que se refleja en el crecimiento de la población, de las ciudades y de la renta, al propio tiempo que aumentaría considerablemente la actividad del sector externo. Sin embargo, al mismo tiempo, se abre una clara brecha entre el crecimiento de la economía en términos macroeconómicos y la escasa repartición de la riqueza en amplios sectores de la sociedad, así que el hilo conductor de este artículo es el analizar cómo es que a pesar de este desarrollo económico, se creó un modelo económico basado en – y es una herencia aún vigente en el México contemporáneo- grandes desigualdades sociales que traen como consecuencia la ausencia de elementos que permiten cohesión social en el país. |
| Keywords: | Globalización económica; Siglo XIX; Desarrollo económico; Historia económica; cohesión social. |
| JEL: | F6 F60 F63 O10 N10 |
| Date: | 2016–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:col:000418:015520&r=int |
| By: | Swati Dhingra; Hanwei Huang; Gianmarco I. P. Ottaviano; Joao Paulo Pessoa; Thomas Sampson; John Van Reenen |
| Abstract: | This paper estimates the welfare effects of Brexit, focusing on trade and fiscal transfers. We use a standard quantitative general equilibrium trade model with many countries and sectors and trade in intermediates, as in Costinot and Rodríguez-Clare (2014). We simulate a range of counterfactuals reflecting alternative options for EU-UK relations following Brexit. Welfare losses for the average UK household are 1:3% if the UK remains in the EU's Single Market like Norway (a "soft Brexit"). Losses rise to 2:7% if the UK trades with the EU under World Trade Organization rules (a "hard Brexit"). A reduced form approach that captures the dynamic effects of Brexit on productivity more than triples these losses and implies a decline in average income per capita of between 6:3% and 9:4%, partly via falls in foreign investment. These negative effects are widely shared across the entire income distribution and are unlikely to be offset from new trade deals. |
| Keywords: | Trade, Brexit, General equilibrium |
| JEL: | F13 F15 F17 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1478&r=int |
| By: | Kolev, Galina V. |
| Abstract: | Drei Jahre nach Beginn des Verhandlungsprozesses über das geplante Freihandelsabkommen TTIP zwischen der EU und den USA breitet sich die Skepsis besonders im deutschsprachigen Raum weiter aus. Zwar unterstützt die Mehrheit der Bevölkerung den Freihandelsgedanken und protektionistische Maßnahmen haben ein schlechtes Image. Trotzdem findet sich etwa in Deutschland eine solide Mehrheit, die TTIP ablehnt. Die vorliegende empirische Analyse untersucht potenzielle Ursachen für Skepsis gegenüber TTIP. Diese geht mit einem schlechten Image des Globalisierungsprozesses und einem mangelnden Verständnis für seine ökonomischen Vorteile einher. Doch die Ergebnisse zeigen, dass die Ablehnung des Freihandelsabkommens auch durch ein geringes Vertrauen in die EU und durch die Unzufriedenheit mit der Art und Weise, wie Demokratie auf der EU-Ebene funktioniert, befeuert wird. Auch die Offenheit für Fremdgruppen ist positiv mit der Zustimmung zu TTIP korreliert. Zusammenfassend lässt sich aus der empirischen Analyse ableiten, dass hinter der TTIP-Skepsis eine Reihe von Ursachen steckt, die nur einen indirekten Bezug zu TTIP haben. Die Ablehnung des Freihandelsabkommens ist ein Teil des Protests gegen die Strukturen der EU, sodass mögliche Ansätze für mehr TTIP-Unterstützung darin bestehen, das Vertrauen in die EU auszubauen. Heutzutage werden die Errungenschaften der europäischen Integration als eine Gegebenheit empfunden und ihre Vorteile nicht richtig wahrgenommen. Zudem ist die gefühlte Distanz zu den Europäischen Institutionen mit einem verstärkten Gefühl verbunden, dass die EU-Bürger den politischen Prozess nicht beeinflussen können. Es ist somit nicht nur für die Zukunftsfähigkeit der EU von großer Bedeutung, die Funktionsweise der EUDemokratie zu verbessern und auch die positiven Seiten der europäischen Integration ins Gedächtnis zu rufen. Auch der Kampf um die Unterstützung für TTIP dürfte davon profitieren. |
| JEL: | F13 D78 F59 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwkrep:252016&r=int |
| By: | Lodovico Muratori (Sapienza University of Rome, Italy; Friedrich Schiller University Jena, Germany); Susanne Fricke (Friedrich Schiller University Jena, Germany) |
| Abstract: | We assess the conjunctural impact of price insulating policies on spatial price transmission of maize, rice and wheat in Cameroon, Kenya and Tanzania in the period 2005-2015. We therefore separately estimate the impact of trade policies within two regimes of behaviour of the domestic price series: the first regime with an increasing trend of domestic prices and the second regime with a decreasing trend. We find a significant impact of trade policies in both price regimes. This is however much larger if prices are increasing. Our results show that trade policies were able to insulate the three analyzed countries from the price shocks on international markets during the food price spike crisis 2007/2008. Although the impact of these policy instruments proved to be relevant as a counter-cyclical measure during the food price spike crisis, these policies cannot be regarded as structural long-term solutions. This paper extends the existing literature on spatial price transmission in agricultural markets by estimating the impact of tariff and non-tariff trade policies using monthly data. Employing monthly data allows for a more precise assessment of short-lived movements in the analysed series, which could disappear due to a time aggregation bias at lower yearly frequencies. While monthly price series are provided in the GIEWS database, we obtain monthly ad-valorem equivalent tariff rates by a time disaggregation of the yearly effectively applied weighted average tariff rate from the WITS/UNCTAD- TRAINS database through the monthly trade policies from the FAO-FADPA. By presenting high frequency analyses and techniques that are able to detect non-linearities in the Data Generating Process (DGP), this study provides results which differ from what is stated in the standard literature (Anderson and Nelgen, 2012a) (Anderson and Nelgen, 2012b) (Anderson and Nelgen, 2012c). |
| Keywords: | spatial price transmission, staple crops, trade barriers, food price spikes |
| JEL: | F14 O24 Q11 Q17 |
| Date: | 2017–04–27 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2017-006&r=int |
| By: | SASAKI Yuri; YOSHIDA Yushi |
| Abstract: | Hit by the global financial crisis and a great earthquake followed by a tsunami, Japan's trade balance has turned to deficit, ending its 26 years of trade surplus. However, it is puzzling that its trade balance has remained long in deficit even during the sharp depreciation of the yen beginning at the end of 2012. We construct several alternative indices for price and quantity, decomposed at the country and industry level, for Japanese exports and imports between 1988 and 2014. Income elasticity, price elasticity, and pass-through elasticity are estimated at the country and industry disaggregated levels. The estimated results support that Japanese trade experienced a structural change both in income and exchange rate pass-through elasticity. After the crisis, exports became more unresponsive to exchange rate fluctuations, whereas import prices rose more proportionately with the depreciation of the yen and income elasticity of imports rose sharply. The difference in income elasticity between Japan and the rest of world is reminiscent of the Houthakker-Magee effect and suggests that the trade balance of Japan is likely to deteriorate. The decomposition of Japanese trade reveals that almost every element shifted, resulting in the deterioration of the external balance. |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:17042&r=int |
| By: | Cheng-Te Lee (Department of International Trade, Chinese Culture University, Taiwan); Deng-Shing Huang (Institute of Economics, Academia Sinica, Taipei, Taiwan) |
| Abstract: | This paper constructs a theoretical framework to analyze the impact of international openness of the relatively big globalizers on specialization. In contrast to the conventional positive effect of market size on specialization, we show market expansion induced by asymmetric globalization may decrease the level of specialization in terms of components. In addition, the number of components produced in the big globalizers may also decrease, a case distinct from the conventional home-market effects. JEL Calssification: F12, L11 |
| Keywords: | global market size, asymmetric globalization, specialization, home market effects |
| Date: | 2017–02 |
| URL: | http://d.repec.org/n?u=RePEc:sin:wpaper:17-a004&r=int |
| By: | Lorenzo Caliendo; Fernando Parro; Aleh Tsyvinski |
| Abstract: | We develop a model of the world economy as input-output relationships subject to distortions. We then propose a methodology to solve the identification problem, common to the literature on misallocation in input-output relationships, of separating sectoral TFPs from the sectoral distortions. Using both the input shares and the consumption shares within the CES production and CES consumption structure we derive simple closed-form sufficient statistics for the sectoral distortions and for the sectoral TFPs. We then derive a closed-form solution of the elasticities of each entry in the world input-output matrix to distortions. We compute a total of more than half a million internal distortions and TFPs and document significant heterogeneity of those across countries and sectors. We then calculate the whole matrix of about two million elasticities to distortions and TFPs of the input-output matrix of the world economy. We show that internal (within a given country) distortions significantly affect the structure of the economy of that country and have sizeable cross effects on the input-output matrix of other countries. We then find that the world GDP elasticity to changes in internal distortions is an order of magnitude larger than that of the external distortions. |
| JEL: | C67 E00 E1 F00 O11 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23332&r=int |
| By: | Martin Schorr; Andres Wainer |
| Abstract: | En la Argentina, las grandes firmas tienen un papel central tanto en la demanda como en la oferta de divisas, lo cual les confirió un rol clave en la dinámica del modo de acumulación que se desplegó bajo los gobiernos del kirchnerismo (2003-2015). En este artículo se analiza la incidencia que tuvieron las empresas líderes en el comercio exterior del país, aspecto central dado que este fue el único rubro del balance de pagos que registró superávits sistemáticos hasta el año 2014. Para ello se toman en cuenta distintas variables de las 200 compañías más grandes de la economía argentina excluyendo a las firmas del sector financiero. En este sentido, el objetivo del trabajo es el de aportar algunos elementos de juicio referidos a las características y las restricciones que caracterizan el perfil de inserción del país en la división mundial del trabajo. |
| Keywords: | Grandes empresas; Argentina; comercio exterior; kirchnerismo; restricciónexterna |
| JEL: | F10 N16 N86 L13 Z13 |
| Date: | 2016–12–28 |
| URL: | http://d.repec.org/n?u=RePEc:col:000418:015543&r=int |