nep-int New Economics Papers
on International Trade
Issue of 2018‒05‒14
25 papers chosen by
Luca Salvatici
Università degli studi Roma Tre

  2. The Cost of Non-Europe, Revisited By Thierry Mayer; Vincent Vicard; Soledad Zignago
  3. Trade Compatibility between Afghanistan and India: An empirical evaluation By Wani, Dr. Nassir Ul Haq
  4. Recent Trends in Africa’s Services Trade By Ayoki, Milton
  5. Does Democracy Increase Bilateral Trade in MENA Region? By Roesmara Donna, Duddy; Widodo, Tri; Adiningsih, Sri
  6. Globalization, Government Popularity, and the Great Skill Divide By Aksoy, Cevat Giray; Guriev, Sergei; Treisman, Daniel
  7. The happy few: cross-country evidence of the euro effect on trade By Salvador Gil-Pareja; Rafael Llorca-Vivero; José Antonio Martínez-Serrano
  8. Trade with Benefits: New Insights on Competition and Innovation By JaeBin Ahn; Hyoungmin Han; Yi Huang
  9. Neocolonialism or Balanced Partnership? Reframing Agricultural Relations Between the EU and Africa By Lungu, Ioana
  10. Trade law and trade fl ows By Salvador Gil-Pareja; Rafael Llorca-Vivero; Jordi Paniagua
  11. Innovation and Trade Policy in a Globalized World By Akcigit, Ufuk; Ates, Sina T.; Impullitti, Giammario
  12. Exchange Rate Volatility and Trade: External Exchange Rate Volatility Matters By Tunc, Cengiz; Solakoglu, Mehmet Nihat; Hazar, Adalet; Babuscu, Senol
  13. Networks and Trade By Bernard, Andrew B.; Moxnes, Andreas
  14. Just peanuts? Trump's protective tariffs and their impact on Africa By Kohnert, Dirk
  15. Of course Collusion Should be Prosecuted. But Maybe... Or (The case for international antitrust agreements) By Filomena Garcia; Jose Manuel Paz y Minõ; Gustavo Torrens
  16. On Barriers to Technology Adoption, Appropriate Technology and Deep Integration (with implications for the European Union) By Mercenier, Jean; Voyvoda, Ebru
  17. Emigration, remittances and the subjective well-being of those staying behind By Artjoms Ivlevs; Milena Nikolova; Carol Graham
  18. Globalization misguided views By OBREGON, CARLOS
  19. Selective immigration policies, occupational licensing, and the quality of migrants’ education-occupation match By Tani, Massimiliano
  20. Long-Term Relatedness between Countries and International Migrant Selection By Krieger, Tim; Renner, Laura; Ruhose, Jens
  21. Illegal Immigration, Unemployment, and Multiple Destinations By Kaz Miyagiwa; Yasuhiro Sato
  22. Impact of private labels and information campaigns on organic and fair trade food demand By Douadia Bougherara; Carole Ropars-Collet; Carole Jude Saint-Gilles
  23. The Changing Structure of Immigration to the OECD: What Welfare Effects on Member Countries? By Michal Burzynski; Frédéric Docquier; Hillel Rapoport
  24. Trade misinvoicing in OECD countries: what can we learn from bilateral trade intensity indices? By Carton, Christine; Slim, Sadri
  25. Water Content in Trade: A Regional Analysis for Morocco By Eduardo Amaral Haddad; Fatima Ezzahra Mengoub; Vinicius A. Vale

  1. By: Luca Salvatici; Alessandro Antimiani; Fusacchia Ilaria
    Abstract: Production and trade are increasingly organized within Global Value Chains (GVCs) and therefore assessing who effectively pays the cost of protection is not straightforward. Since exports rely on imported inputs, the evaluation of trade policies requires the use of new trade metrics on a value-added base in order to assess in which country the value embedded in trade has been actually produced. We define a new set of trade policy indexes in the spirit of the protection indexes introduced by Anderson and Neary, based on the value added in trade: the Value Added Trade Restrictiveness Indexes (VATRIs). VATRIs are theoretically sound protection measurements that make use of the trade flow decomposition proposed by the recent value added in trade literature. We compute the direct and indirect components of trade protection by computing the VATRIs using the Global Trade Analysis Project computable general equilibrium model.
    Keywords: Trade policies, Trade Restrictiveness Index (TRI), Value-added trade, Global Trade Analysis Project (GTAP), Global Value Chains (GVCs), Value added trade.
    JEL: F13 C67
    Date: 2018–05
  2. By: Thierry Mayer; Vincent Vicard; Soledad Zignago
    Abstract: In this paper we quantify the "Cost of Non-Europe", i.e. the trade-related welfare gains each country member has reaped from the European Union. Thirty years after the terminology of Non-Europe was used to give estimates of the gains from further integration, we use modern versions of the gravity model to estimate the trade creation implied by the EU, and apply those to counterfactual exercises where for instance the EU returns to a "normal'', shallow-type regional agreement, or reverts to WTO rules. Those scenarios are envisioned with or without the exit of the United Kingdom from the EU (Brexit) happening, which points to interesting cross-country differences and potential cascade effects in doing and undoing of trade agreements.
    Keywords: Trade Integration;Gravity;European Union
    JEL: F1
    Date: 2018–04
  3. By: Wani, Dr. Nassir Ul Haq
    Abstract: In order to expedite the flow of trade the number of regional trade agreements has grown among the countries since the globalization has started. The dramatic changes are quiet visible as these RTA are lucrative and attractive for the countries to manage their trade. Afghanistan started its regional trade with neighboring countries after joining SAARC in 2008. The study period is covering 8 years data from 2008-2015 by employing SITC Revision III classification. The prime focus of this article is to evaluate the trade compatibility between Afghanistan and India by employing Revealed Comparative Advantage (RCA) and Trade Intensity Index (TII). From the results, it is quite clear that the trade between two countries is proceeding in India’s favor. Afghanistan enjoys the comparative advantage in just one product category and for the rest of the products, the values of RCA are less than 1. India enjoys RCA in four product categories. The paper concludes with this recommendation that it will be better for both countries to keep promoting the export of the products which has the RCA ˃ 1. India is leading the existing export market because of its strong export base. Both countries should strive to improve their export potential products, in order to gain the market and to be compatible and competitive partners with one another.
    Keywords: Afghanistan, India, Trade Policy
    JEL: F1 F13 F14
    Date: 2018–01–31
  4. By: Ayoki, Milton
    Abstract: This paper offers an assessment of the status of services trade in Africa. It addresses three policy questions: how Africa has fared in trade in services trade over the past decade relative to other regions of the world; who the key players and partners are; and the sectors shaping Africa’s services trade. Africa’s trade in commercial services remains very concentrated in a few countries. Over the last 11 years (2006–2016) only three countries—Egypt, South Africa and Morocco accounted for 55.5 percent of Africa’s exports; and five countries—Nigeria, Angola, South Africa, Egypt and Algeria accounted for 55 percent of Africa’s imports). The implication is that conditions facing those countries will continue to influence Africa’s services landscape. Second, infrastructural constraints (including low rates of access to the Internet and poor connectivity) has hindered the participation of African economies in the most dynamic segment of services trade leading to high export concentration (in very few sectors such as transport, tourism and travel-related services) heightening its vulnerability to external shocks. Third, with less than 10 percent of the value of services produced in most countries entering into the economy’s export basket, growth in services sector will continue to have very limited influence on the world market (share in global service exports). Reforms and programmes aimed at reducing trade barriers and cost of trading across borders (raised by inefficient transport, border management, and logistics, poorly designed technical regulations and standards, licensing requirements and process, among others) would not only create opportunities to directly expand services exports, but would also promote the development of competitive value chains of production across the region
    Keywords: Trade in Services, Developing Countries, Africa, GATs.
    JEL: F13 F14 F15
    Date: 2018–01–08
  5. By: Roesmara Donna, Duddy; Widodo, Tri; Adiningsih, Sri
    Abstract: This paper aims to analyze the effects of democracy to the trade of countries in MENA Regions. The Gravity Model used to test the effects of democracy on trade. Estimation is done with several models, that is FE, RE, MLE, and PPML. From this estimation can be detected endogenity problem that is caused by simultaneity between export and democracy. The FE model with the infant mortality rate as instrumental variable was chosen to address the problem. After controlling endogenity, it can be concluded that democracy positively affects (3-4 per cent) of trade in MENA Regions, especially democracy in partner countries.
    Keywords: trade, export, democracy, Gravity Model, MENA.
    JEL: F14 F17
    Date: 2018–01–05
  6. By: Aksoy, Cevat Giray; Guriev, Sergei; Treisman, Daniel
    Abstract: How does international trade affect the popularity of governments and leaders? We provide the first large-scale, systematic evidence that the divide between skilled and unskilled workers worldwide is producing corresponding differences in the response of political preferences to trade shocks. Using a unique data set including 118 countries and nearly 450,000 individuals, we find that growth in high skill intensive exports (of goods and services) increases approval of the leader and incumbent government among skilled individuals. Growth in high skill intensive imports has the opposite effect. There is no effect on political approval among the unskilled. To identify exogenous variation in international trade, we exploit the time-varying effects of air and sea distances in bilateral trade flows. Our findings suggest that the political effects of international trade differ with skill intensity and that skilled individuals respond differently from their unskilled counterparts to trade shocks.
    Keywords: International trade; political approval; political polarization; skill intensity of trade.
    JEL: D72 F14 G02 P16
    Date: 2018–04
  7. By: Salvador Gil-Pareja (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).); Rafael Llorca-Vivero (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).); José Antonio Martínez-Serrano (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).)
    Abstract: This paper investigates the EMU effect on trade by member country and direction of trade flows. The empirical analysis uses a recent econometric development, which allows us the estimation of gravity equations dealing with heteroskedastic residuals and zero bilateral trade flows on a large span of data (across both countries and periods). Our results, robust to using alternative samples and EU time-trends, suggest that, while there is no evidence of an aggregate EMU effect, some few countries have benefited from sharing the euro. In particular, for Spain and Portugal, this is the case for both exports and import flows. By contrast, the EMU has had a negative effect on import flows in the Netherlands and Malta, while we find a negative impact for exports from Greece.
    Keywords: EMU, exports, imports, HDFE PPML, gravity equation.
    JEL: F14
    Date: 2018–03
  8. By: JaeBin Ahn (International Monetary Fund); Hyoungmin Han (The Graduate Institute of International and Development Studies, Geneva); Yi Huang (The Graduate Institute of International and Development Studies, Geneva)
    Abstract: This paper examines how Korea’s import and export linkages with China affect the innovation outcomes of Korean manufacturing firms. Using our automated algorithm, we match Korean patent data to KIS-Value firm data from 1996 to 2015. We find that rising import and export with China lead to more patent applications by Korean manufacturing firms, with the positive impact particularly driven by large or public firms compared to SMEs or private firms. Most importantly, all of these results hold only in those sectors with higher quality products than Chinese products, shedding lights on reconciling recent empirical studies that found conflicting evidence on ’Schumpeterian force’ and ’escaping competition.’
    Keywords: Competition, Innovation, China Shock, Schumpeterian Force, Escaping Competition
    JEL: F14 F16 O34
    Date: 2018–05
  9. By: Lungu, Ioana
    Abstract: The media narratives with respect to EU external policies and their effects on developing countries generally paint a picture of unequal power dynamics and negative externalities, particularly with respect to international trade and land grabbing. In this paper, I use trade data to argue that reality is more nuanced and aim to provide a preliminary sketch of the institutional dynamics between the EU and Africa. I focus on agricultural relationships to highlight the interplay between historical path dependencies, colonialism, trade policy and domestic institutions on the EU and African side. While trade is often portrayed in an overly simplified manner as the main factor hindering agricultural development, African countries are often plagued by a long history of extractive institutions, both politically and economically, which lead to a vicious cycle of unequally distributed resources, exploitation, insecure human rights and a lack of incentives for innovation. This becomes apparent when examining phenomena such as land-grabbing, which often involve African elites partnering with foreign investors to conclude controversial deals. Overall, this paper aims to highlight the necessity of building institutional capacity particularly in countries with a long history of extractive institutional continuity, and to underline the importance of state centralisation for agricultural development, so that African partners can fully take advantage of the preferential trade regime with the EU and improve their position with respect to power dynamics.
    Keywords: Agricultural Economics,Development,International Trade,Agricultural Policy,Governance,Foreign Assistance,Institution Building,Institutions,Least Developed Countries,Trade Liberalization
    JEL: O19 O13 O17 O24 Q15 O20
    Date: 2017
  10. By: Salvador Gil-Pareja (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).); Rafael Llorca-Vivero (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).); Jordi Paniagua (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia (Spain).)
    Abstract: This paper performs a structural gravity estimation of the effect of commercial law conventions on international trade flows. We focus on trade law agreements aimed to privately resolve disputes among partners: international commercial arbitration, model law and conciliation. Our results suggest three interesting traits. First, international dispute resolution mechanisms have a moderate positive impact on trade, which is stronger for similar country-pairs in terms of income. Second, this effect is not observed in agreements which do not tackle private resolution mechanisms. Third, international commercial arbitration is the most effective tool to promote trade.
    Keywords: international trade law, international commercial arbitration, model law, conciliation, international trade, structural gravity
    JEL: F14 K12
    Date: 2018–04
  11. By: Akcigit, Ufuk; Ates, Sina T.; Impullitti, Giammario
    Abstract: How do import tariffs and R&D subsidies help domestic firms compete globally? How do these policies affect aggregate growth and economic welfare? To answer these questions, we build a dynamic general equilibrium growth model where firm innovation endogenously determines the dynamics of technology, and, therefore, market leadership and trade flows, in a world with two large open economies at different stages of development. Firms' R&D decisions are driven by (i) the defensive innovation motive, (ii) the expansionary innovation motive, and (iii) technology spillovers. The theoretical investigation illustrates that, statically, globalization (defined as reduced trade barriers) has ambiguous effects on welfare, while, dynamically, intensified globalization boosts domestic innovation through induced international competition. Accounting for transitional dynamics, we use our model for policy evaluation and compute optimal policies over different time horizons. The model suggests that the introduction of the Research and Experimentation Tax Credit in 1981 proves to be an effective policy response to foreign competition, generating substantial welfare gains in the long run. A counterfactual exercise shows that increasing tariffs as an alternative policy response improves domestic welfare only when the policymaker cares about the very short run, and only when introduced unilaterally. Tariffs generate large welfare losses in the medium and long run, or when there is retaliation by the foreign economy. Protectionist measures generate large dynamic losses by distorting the impact of openness on innovation incentives and productivity growth. Finally, our model predicts that a more globalized world entails less government intervention, thanks to innovation-stimulating effects of intensified international competition.
    Keywords: Competition; Economic Growth; foreign technological catching-up; innovation policy; short- and long-run gains from globalization; trade policy
    JEL: F13 F43 O40
    Date: 2018–04
  12. By: Tunc, Cengiz; Solakoglu, Mehmet Nihat; Hazar, Adalet; Babuscu, Senol
    Abstract: Using World Bank’s Exporter Dynamics Database, we investigate the role of external exchange rate volatility on export in addition to the effect of bilateral exchange rate volatility. The results show that while the bilateral exchange rate volatility has depressing effect on export, external exchange rate volatility generates trade-promoting effect. However, the magnitude of the effect depends on the trade intensity between countries and the economic development of the destination country. We further find strong asymmetric effect that both the trade-depressing effect of the bilateral volatility and trade-promoting effect of the external volatility are larger for exchange rate depreciations and for larger swings in the volatilities.
    Keywords: Exchange rate volatility, International trade, Third-country effect
    JEL: F13 F31 F41
    Date: 2018–04
  13. By: Bernard, Andrew B.; Moxnes, Andreas
    Abstract: Trade occurs between firms both across borders and within countries, and the vast majority of trade transactions includes at least one large firm with many trading partners. This paper reviews the literature on firm-to-firm connections in trade. A growing body of evidence coming from domestic and international transaction data has established empirical regularities which have inspired the development of new theories emphasizing firm heterogeneity among both buyers and suppliers in production networks. Theoretical work has considered both static and dynamic matching environments in a framework of many-to-many matching. The literature on trade and production networks is at an early stage, and there are a large number of unanswered empirical and theoretical questions.
    Keywords: International Trade; offshoring; production networks; productivity
    JEL: F10 F12 F14 L11 L21
    Date: 2018–04
  14. By: Kohnert, Dirk
    Abstract: The international discussion of Trump's dispute over import tariffs for steel, aluminum and even cars is so far focused on the big global players. However, African countries in particular could suffer too from the planned punitive tariffs, analogous to the famous African proverb, "When elephants fight, it is the grass that suffers". Egypt and South Africa for example, the potentially most affected countries in Africa, face massive job losses and earning opportunities, with all the consequences that this entails for their already fragile economy and their population in dire poverty.
    Keywords: Trade policy
    JEL: F13 F51 F52 H21 P16 P52
    Date: 2018
  15. By: Filomena Garcia (Indiana University, & UECE); Jose Manuel Paz y Minõ (Indiana University); Gustavo Torrens (Indiana University)
    Abstract: We study the incentives of competition authorities to prosecute collusive practices of domestic and foreign firms. For that purpose, we develop a model of multi-market contact between two firms that can engage in collusion in two countries. In each country, there is a competition authority with a mandate to maximize national welfare. Each competition authority decides its prosecution policy at the beginning of time and commits to it. In equilibrium, the ownership distribution of the firms (domestic versus foreign) affects prosecution policies. The country that does not own the firms prosecutes them as soon as information of collusion becomes available. On the contrary, the country that owns the firms has an incentive to protect their profits in foreign markets delaying prosecution. This strategic delay is valuable because it contains the information spreading that could trigger prosecution in the foreign country. Prosecution delays, however, are not optimal from the point of view of global welfare, something that could be solved through the integration of the competition authorities. The country of origin of the firms would nevertheless oppose integration. Finally, in a multi-industry setting, both countries delay prosecuting domestic firms, which again is not optimal from the point of view of global welfare. Moreover, in a multi-industry setting, both countries can be better off under integration.
    Keywords: Multi-market Collusion, Antitrust Policy, Strategic Prosecution, International Antitrust Agreements
    JEL: F23 F53 L41 K21
    Date: 2018–05
  16. By: Mercenier, Jean; Voyvoda, Ebru
    Abstract: Based on two strands of research, namely ‘barriers to technology adoption’ and ‘appropriate technology’, we propose a formal reappraisal of ‘deep integration’, a broad concept often used in trade policy discussions. We then evaluate the 2004-7 EU enlargement wave utilizing this operational reappraisal. More specifically, we first estimate, using 2007 data, total labor productivity (TLP) in the 27 EU member states, and show that in all but a few sectors, new member states clearly stand below the lower envelope technology frontier of the older members in their use of skilled and unskilled labor. We interpret this as being the result of past barriers to technology adoption that are likely to be removed by the integration process into the EU, with these new counties’ TLP shifting to the incumbent members’ lower envelope. We then explore the potential effects on all 27 EU member states of this ‘deep integration’ experiment using a calibrated intertemporal multisectoral general equilibrium model. Our main finding is that, for most parameter configurations, workers’ welfare in incumbent member countries is not negatively impacted despite the rather drastic improvement in competitiveness experienced by new members.
    Keywords: Barriers to technology adoption, appropriate technology, technological upgrading, deep integration, European integration, calibrated general equilibrium
    JEL: D58 E23 F12 J31 O14 R13
    Date: 2018–04–25
  17. By: Artjoms Ivlevs (University of the West of England); Milena Nikolova (University of Maryland, College Park); Carol Graham (The Brookings Institution)
    Abstract: Despite growing academic and policy interest in the subjective well-being consequences of emigration for those left behind, existing studies have focused on single origin countries or specific world regions. Our study is the first to offer a global perspective on the well-being consequences of emigration for those staying behind using several subjective well-being measures (evaluations of best possible life, positive affect, stress, and depression). Drawing upon Gallup World Poll data for 114 countries during 2009-2011, we find that both having family members abroad and receiving remittances are positively associated with evaluative well-being (evaluations of best possible life) and positive affect (measured by an index of variables related to experiencing positive feelings at a particular point in time). Our analysis provides novel results showing that remittances are particularly beneficial for evaluative well-being in less developed and more unequal contexts; in richer countries, only the out-migration of family members is positively associated with life evaluations, while remittances have no additional association. We also find that having household members abroad is linked with increased stress and depression, which are not offset by remittances. The out-migration of family members appears more traumatic in contexts where migration is less common, such as more developed countries, and specific world regions, such as Latin America and Sub-Saharan Africa, as well as among women. Relying on subjective well-being measures, which reflect both material and non-material aspects of life and are broad measures of well-being, allows us to provide additional insights and a more well-rounded picture of the possible consequences of emigration on migrant family members staying behind relative to standard outcomes employed in the literature, such as the left-behind’s consumption, income or labor market responses.
    Keywords: migration, remittances, depression, stress, Cantril ladder of life, happiness, Gallup World Poll
    JEL: F22 F24 I30 O15 J61
    Date: 2018–05
    Abstract: Today, the world is in an evident disarray; many things seem to have gone wrong at once. Various topics: terrorism, drug trafficking, money laundering, black accounts; financial crises, income distribution, global coordination; or the social angriness and growing anti-migration —nationalistic-protectionist— sentiments and policies, show that something has changed for the worse. As we will see, all these events have a common deep cause that we must first understand, in order to be able to cope with its consequences. We are living a technological revolution that, in many ways, surpasses the so-called Industrial Revolutions, particularly because of the speed at which it is bringing change. We defend that institutions have not yet adapted to the new world that this technological revolution has brought about. Today’s inadequate institutional arrangements are sustained by old concepts or economic theories and ideas that no longer work as they did before. This mismatch between the new technological world and the old institutions explains most of today’s world economic problems.
    Keywords: Globalization, Financial crises, Income distribution, Global coordination, Nationalism, Protectionism, Anti-migration.
    JEL: F0 F01 F13 F2 F20 F21 F22 F23 F3
    Date: 2018–04–09
  19. By: Tani, Massimiliano
    Abstract: This paper studies occupational licensing as a possible cause of poor labour market outcomes among economic migrants. The analysis uses panel data from Australia, which implements one of the world’s largest selective immigration programmes, and applies both cross-sectional and panel estimators. Licensing emerges as acting as an additional selection hurdle, mostly improving wages and reducing over-education and occupational downgrade of those working in licensed jobs. However, not every migrant continues working in a licensed occupation after settlement. In this case there is substantial skill wastage. These results do not change over time, after employers observe migrants’ productivity and migrants familiarise with the workings of the labour market, supporting the case for tighter coordination between employment and immigration policies to address the under-use of migrants’ human capital.
    Keywords: skilled immigration,over-education,occupational downgrade,immigration policy,occupational licensing
    JEL: J8 J24 J61
    Date: 2018
  20. By: Krieger, Tim; Renner, Laura; Ruhose, Jens
    Abstract: This paper studies the effect of the long-term relatedness between countries, measured by their genetic distance, on educational migrant selection. Analyzing bilateral migrant stocks of the 15 main destination countries and 85 sending countries for the year 2000, we find that migrant selection and genetic distance follow a nonlinear J-shaped pattern: at low levels of genetic distance, increases in genetic distance reduce the positive selection of migration. However, at higher levels of genetic distance, this pattern is reversed and migration becomes more positively selected. We complement this finding by showing that the net benefits of genetic distance are strongly decreasing for low-skilled migrants with increasing genetic distance, while high-skilled migrants are less responsive to genetic distance in general. Results are robust to conditioning on bilateral control variables, including various destination- and sending-country-specific fixed effects and applying an instrumental variables approach that exploits exogenous variation in genetic distances in the year 1500.
    Keywords: Long-term Relatedness,Genetic Distance,Culture,International Migration,Selection
    JEL: F22 J61 Z1
    Date: 2018
  21. By: Kaz Miyagiwa (Department of Economics, Florida International University); Yasuhiro Sato (University of Tokyo)
    Abstract: We develop a multi-country model of illegal immigration with equilibrium unemployment. Two geographic cases are considered. One has two destinations adjacent to the source country while the other has just one destination country adjacent to it. In both cases, the equilibrium border control proves insufficient compared with the joint optimum, calling for enforcement by federal authorities. Absent such authorities, delegating border control to the country with a larger native labor force can improve each destination country¡¯s welfare. In contrast, the equilibrium internal enforcement policy is efficient, obviating enforcement by supranational authorities.
    Keywords: illegal immigration, immigration policy competition, equilibrium unemployment, multiple destinations, job search
    JEL: F22 H77 J61 J64
    Date: 2018–05
  22. By: Douadia Bougherara; Carole Ropars-Collet; Carole Jude Saint-Gilles
    Abstract: We use Almost Ideal Demand Systems (AIDS) models estimated by the nonlinear seemingly unrelated regression (SUR) method on scanner data (i) to examine the demand for ecolabeled food products (organic and fair trade) as a function of the good having a private label (PL) or a national brand (NB) and (ii) to assess the impact of information campaigns promoting organic and fair trade products. We find that while demand is elastic for NB organic milk and NB fair trade coffee, it is inelastic for their PL counterpart. As for organic eggs, demand is always inelastic. Cross-price elasticities show substitutability between ecolabeled and conventional goods but only within the NB goods (milk and eggs) and within the PL goods (milk and coffee), but also complementarity between NB conventional and PL ecolabeled goods (milk and coffee). Finally, we find that while information campaigns increase the predicted expenditure shares of PL organic milk by 33%, of NB fair trade coffee by 50%, they decrease the predicted expenditure shares of PL conventional eggs but only by 3%. These effects are non-lasting.
    Keywords: organic, Fair trade, information campaign
    JEL: D12 Q5 D82
    Date: 2018–05
  23. By: Michal Burzynski; Frédéric Docquier; Hillel Rapoport
    Abstract: We investigate the welfare implications of two pre-crisis immigration waves (1991–2000 and 2001–2010) and of the post-crisis wave (2011–2015) for OECD native citizens. To do so, we develop a general equilibrium model that accounts for the main channels of transmission of immigration shocks – the employment and wage effects, the fiscal effect, and the market size effect – and for the interactions between them. We parameterize our model for 20 selected OECD member states. We find that the three waves induce positive effects on the real income of natives, however the size of these gains varies considerably across countries and across skill groups. In relative terms, the post-crisis wave induces smaller welfare gains compared to the previous ones. This is due to the changing origin mix of immigrants, which translates into lower levels of human capital and smaller fiscal gains. However, differences across cohorts explain a tiny fraction of the highly persistent, cross-country heterogeneity in the economic benefits from immigration.
    Keywords: immigration, welfare, crisis, inequality, general equilibrium
    JEL: C68 F22 J24
    Date: 2018
  24. By: Carton, Christine; Slim, Sadri
    Abstract: This paper aims to explore the extend of trade misinvoicing among OECD countries over the period 2006-2016. Following the standard approach developed by Morgenstern (1950), four categories of misreported bilateral transactions are estimated to highlight two channels used to shift illicit financial flows. The study is reinforced by an analysis in terms of bilateral intensity indices proposed by Kojima (1964) and extended by Kunimoto (1977) to determine trends and patterns in trade misinvoicing among bilateral relations for selected OECD countries. Some interesting findings can be pointed out: (i) the assessment of intra-OECD misinvoicing trade shows that the accumulated amount reaches more than 12 trillion US dollars over the period and is characterised by illicit inflows, although outflows tend to increase during the last years; (ii) significant amounts of illicit financial flows occur in the most advanced countries despite the quality of their statistical recording services; (iii) arguing against explanation based on tax evasion and capital flight, it is shown that countries with high GDP per capita are senders and recipients of illicit financial flows, while lower GDP per capita countries are also receivers of illicit inflows; (iv) the share of misreported imports in countries´ total imports is larger than for total exports, which seems to indicate that imports are the principal vehicle sustaining bilateral misinvoicing trade; and (v) geographical proximity appears to be an important factor in determining the channel used and the direction of illicit financial flows as well as in describing intense relations relative to bilateral misinvoicing trade.
    Keywords: Trade misinvoicing, intra-OECD trade, mirror statistics, bilateral intensity index
    JEL: C10 F14 F32
    Date: 2018–03
  25. By: Eduardo Amaral Haddad; Fatima Ezzahra Mengoub; Vinicius A. Vale
    Abstract: This paper reports the results of an application using an interregional input-output matrix for Morocco together with regional information on water consumption by sectors. We develop a trade-based index that reveals the relative water use intensities associated with specific interregional and international trade flows. We estimate, for each flow associated with each origin-destination pair, measures of trade in value added and trade in water that are further used to calculate our index. We add to the existing literature on virtual water flows by encompassing the subnational perspective in the case study of a country that shows a “climate divide”: while a great part of the southern territory is located in the Sahara Desert, with serious water constraints, the northern part is relatively more privileged with access to this natural resource. Furthermore, we compare that Trade-Based Index of Water Intensity to similar metrics related to the use of other natural resources.
    Date: 2018–04

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